Europe’s Energy Crisis Epiphany

The Russia-Ukraine war approaches its 3rd year in February 2025. Since its full escalation in 2022, the region has witnessed a multitude of problems, ranging from disruption in supply chains to price volatility, especially in the energy sector. Europe was severely impacted due to its dependence on Russian energy supplies. Prior to the war, nearly 40% of pipeline natural gas was supplied to the European Union (EU) by the Russian Federation.

Illustration by The Geostrata

Around 23 democracies on the European continent are members of both the EU and NATO, and thereby unite to support Ukraine against Russia. Therefore, when the war broke out, these countries became vulnerable to energy security as they relied on Russia for their oil and natural gas imports. This article will put forth a comprehensive analysis of the EU's energy security vulnerabilities and its recovery shift to diversify its energy requirement, amidst the Russia-Ukraine war.

THROUGH DATA

The International Energy Agency described the impact of the Russia-Ukraine war on energy security as “the first truly global energy crisis, with impacts that will be felt for years to come.” Pre-war period, Russia fulfilled over 45.3% gas, 27% oil, and 46% coal requirements of the EU, which sums up to an average of approximately 40% of the EU’s energy dependence on Russia. 

The eruption of war became a moment of epiphany for the EU, destroying its beliefs on economic interdependence as a way of integration.

Nevertheless, the European Commission showcased a quick response, addressing the energy security vulnerabilities through various effective measures. Consequently, the total purchase of Russian gas reduced to over 15% in 2023, and currently, it is 8% of Europe’s total gas imports. 

EUROPEAN RESILIENCE AMIDST ENERGY CRISES

The EU nations, often known for their efficient economic integration, found themselves in a dilemma over strategies to deal with the sudden energy crisis, which erupted as a repercussion of the Russia-Ukraine war. Nations like Belgium, France, Sweden, etc, were marginally dependent, Italy, Germany, Poland, Finland, etc, were considerably dependent, whereas, Bulgaria, Latvia, and Hungary were exponentially dependent on the Russian oil and natural gas imports.

The instant response by the European Commission was through the release of the REPowerEU Plan in 2022. This meant immediate cessation of EU’s dependency on Russian fossil fuels through methods such as negotiation on sanctions, diversification of energy supplies, promotion of renewable energy, and energy savings.

The first approach of negotiation was difficult to consolidate upon, as several EU members were largely dependent on Russian fossil fuels. Central European countries like Hungary, Slovakia, and the Czech Republic were given an exemption due to their geographic constraint of being landlocked. Except for Bulgaria, the other two nations continued importing Russian oil. The EU approval of sanctions on Russian gas in 2024.

The second approach worked quite efficiently for the EU, as they developed relations with reliable partners like the US, Norway, Qatar, and several African countries like Algeria and Nigeria for LNG supplies.

Thirdly, the EU turned its attention towards the promotion of Renewable Energy. This includes augmenting its energy mix, especially reducing its reliance on fossil fuels like coal and natural gas. The EU’s Green Deal initiative strives towards making Europe a climate-neutral continent. Considering the current energy challenge, this initiative will facilitate the reduction of dependence on Russian fossil fuel imports.

Lastly, the EU adopted a quick approach to address the energy crisis. The European Commission proposed to achieve larger targets for energy saving. Energy saving is the quickest and cheapest method to reduce the burden of energy security. 

CONCLUSION

On 1st January 2025, Ukraine halted Russian gas supplies to Europe, which passed through its territory.

As per the current status, Ukraine refuses to renege on the transit deal agreement as vengeance against Russia amidst the war. Currently, out of the four pipeline networks, only one is functioning - the TurkStream, which passes through the Black Sea and diverges into two: one heading to Türkiye and the other to Central Europe. Over the past years, Russian gas has reduced to 8% of the EU imports. As per the current case study of Europe’s energy crisis, it is evident that geopolitics is largely dependent on geoeconomics. According to consolidated data, some European countries like France, Spain, Belgium, and the Czech Republic have spent more on Russian energy imports than on financial aid to Ukraine.

Considering the EU’s support for Ukraine in the ongoing war, it is apparent that it has ceased its purchase of Russian oil, as it directly finances the war against Ukraine. As per Europe’s path, it witnessed a tough transition to secure its energy needs, especially losing out on easy Russian imports. For Russia, it has lost a lucrative market, which has further hindered its economy amidst the hefty sanctions by the Western allies. This crisis has translated into a zero-sum game, showcasing the vulnerability caused to both the parties due to their economic interdependencies. Finally, the lesson learnt is to become resilient, so as to avoid vulnerabilities such as the ongoing energy crisis witnessed by Europe. 

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BY ARYA GHADIGAONKAR

TEAM GEOSTRATA

info@thegeostrata.com