Of course, the immediate cause of the current energy crisis is war and subsequent attempts by the West to phase out and avoid Russian oil and gas supplies. However, Thompson points out, competition for both gas and oil has clearly intensified as the Covid pandemic seemed to have passed its worst peaks in the fall of last year and the global economy began to recover. Those signs of rising energy prices were already visible in 2019, just before Covid emerged.
On the one hand, the beneficial effect of US shale oil seemed to have vanished. The expansion of that sector and the supply of shale oil on the world market may have depressed prices for a while. By 2019, it appeared that this sector would not expand indefinitely or perform miracles, especially as demand from China continued to grow strongly.
In the same period, according to Thompson, you have seen increased demand and research for gas. At that time, China and Europe were already starting to compete for LNG transport (limited in number and volume). The US has tried to detach Europe from Russian gas infusion by offering the same shale gas. Gas has become both the source of geopolitical tensions and the weapon of war, as evidenced by the quarrel between the United States and Europe (especially Germany) over the Nord Stream gas pipelines from Russia. In short: the scarcity of the energy market made itself felt even before the outbreak of the war and even then the energy supply was mixed with geopolitics.
According to Thompson, we shouldn’t expect a drop in gas demand anytime soon. It is precisely climate change that increases gas consumption: in China it is increasingly becoming an alternative to coal. In Europe, oil and gas will remain necessary for energy-intensive industrial processes and the production of all types of materials for a long time to come.
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