"Save the gas" policy backfires at European Union
Save the gas
That is the official name of an agreement the European Union members have made to reduce gas consumption with 15 % as of now, to "save" the winter. I know, it is really ridiculous, that in a developped part of the world, the winter has to be "saved". But it all has to do with the gas pipes being cut off by Russia to Europe. And Europe's addiction to Russian gas in the last decades. Europe, and mainly Germany has made itself completely reliant on Russian gas, and especially the cheap price of it. At least, up until a year and a half ago, when 1 megawatt/hour of gas cost around 20 USD. Since then prices have only gone up, due to the tensions in Ukraine, and it went completely berzerk with the draconian economic measures that were taken by the European Union against Russia.
Russia has since then cut down supply to Europe slowly but surely, and will keep on doing that. As Europe has no solution to this problem in the short run.
So, enter, "Save the gas" plan. In short, together the EU-countries will consume 15 % less gas as of now, to be able to go through the winter without the Russian gas supply. At least in theory. But the plan completely backfires at Europe.
Record high gas prices
With the launch of the plan, gas prices have only risen higher and higher, with again a record gas price of 202 USD for 1 megawatt/hour yesterday. The market reacts to this completely in the opposite Europe had hoped. Gas prices go through the roof, as Europe is preparing for winter by piling up gas reserves. So, instead of decreasing demand, demand is actually increasing. And the market is not as dumb as the European Union thought it was. Prices go up, and the European Union pays. As of now 10 times what it payed one and a half year ago. And some of that money is still going to Russia, as Russia is still a supplier to Europe for now.
In fact, Russia has made more money by selling gas to the EU, than ever before. And it has never sold less than now. If that isn't a win-win situation for Russia, making more money for selling less.
I think we don't have to look far for the real reason behind this war...
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