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In the last few years, Europe’s energy landscape has undergone a dramatic shift, due to the ongoing global crisis in Ukraine and in the Middle East. The latest developments in the region, with the Iranian attacks on Israel, put at further risk the energy security of the European Union, in a context in which EU countries already suffered a huge economic setback from the turbolence caused by the 7th October massacre perpetrated by Hamas and the consequential deadly response from Israel in Gaza.

But let’s go back to 2022, when the almost complete European reliance on Russian gas pipelines came to a screeching halt with the invasion of Ukraine, forcing the EU members to scramble for alternative sources, looking for new allies and energy partners. Liquefied natural gas (LNG) from the Middle East and the United States has emerged as a real lifeline for European economies. The German government worked hard to line up floating import terminals on its northern coast, on both the Baltic and the North Sea, while other countries tried to emulate Berlin’s decision. The Italian authorities are trying to cooperate with private firms in the energy and infrastructure sectors in order to build a new floating storage and regasification unit (FSRU) in Ravenna, that will complement the existing LNG terminal in Tuscany. In the first months of 2024, global demand for natural gas has been weak amid a sluggish economy, and the slow growth in China has also reduced competition for natural gas supplies. On the bright side, we also have to highlight how LNG shipments from the U.S. don’t have to go through the Red Sea or other potential choke points on the global sea lines. Meanwhile, more and more pipeline gas is still flowing from Norway and Azerbaijan, with which European countries have established deeper energetic relations. Finally, a key factor has also been the EU countries’ efforts to fill their underground storage infrastructures with gas ahead of winter: at the beginning of February 2024, storage was over 70% full with most of the heating season over (and generally warmer temperatures over the Continent).

Unfortunately, new wars and tensions rose, and the ongoing conflicts in the Middle East region pose a fresh threat to European energy security. Just in 2023, 12.9% of Europe’s LNG went through the Red Sea from suppliers in the Middle East, mainly Qatar, highlighting the vulnerability lying in the transportation routes. Let’s not forget also the historical lessons from this kind of crisis, as past conflicts in the Middle East, like the 1973 Arab-Israeli War, led to oil embargoes and consequentially price shocks on a global scale, affecting the European economies for many years. A regional escalation prompted by the Iran-Israel state of tensions could easily give an even greater blow to EU energy security. In a worst-case scenario, a wider conflict could physically interrupt energy and goods supplies in the greater Middle Eastern region, leaving Asian and European countries scrambling for alternative sources and facing potentially crippling energy shortages.

Such a dynamic shows how much diversification is crucial, not only for Russian gas but also for actors in potentially troubled regions. Accelerating the transition to renewable energy sources is pivotal for the European Union and its member states, while relying on alternative LNG suppliers in Africa and maybe strengthening imports from the United States can help in adapting the economies during the energy transition.

Written by: Francesco Marino