Fitch Says EU’s Russian Gas Phase-Out Feasible
Fitch Ratings on Friday said the European Union could possibly replace Russian gas in its energy mix in the medium term, but added that Europe would have to deal with high gas prices in the short term.
The rating agency said the European Commission’s policy package, which aims to cut dependence on Russian gas by two-thirds by year-end, is possible if proposed increases in liquefied natural gas materialize.
Fitch said the EU has a sizeable LNG import capacity, but most import terminals are concentrated in Spain, Portugal, France and Italy.
Nevertheless, the rating agency pointed out that the US has agreed to supply additional LNG to the EU within a year, and that competitive European prices would encourage the redirection of LNG volumes from Asia. READ: Russia’s Invasion Rattles Financial Markets, Assets Swing
Meanwhile, Fitch noted that the resilience of the European market would be fully tested in case of a full near-term supply cut-off by Russia and that its impact would depend on the duration of the cut-off. # Fitch Says EU’s Russian Gas Phase-Out Feasible
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