AGA: Europe's energy woes prove value of natgas infrastructure
Supply disruptions, surging demand and a lack of infrastructure investment have contributed to surging natural gas prices in Europe and should serve as a wakeup call to U.S. regions that choose LNG imports over domestic supplies, according to the American Gas Association (AGA).
In a statement released Friday, AGA President and CEO Karen Harbert addressed the impact of the war in Ukraine on natural gas markets and warned against reliance on potentially vulnerable imports for critical energy needs.
“With the unfolding chaos abroad and disruption to Europe’s energy markets, natural gas prices for America’s homeowners and business are expected to remain stable. America’s abundant natural gas supply and vast delivery system insulates us from instability across the ocean and unstable leaders with reckless political agendas,” Herbert said.
“But we cannot ignore the fact that there are areas of the country that have refused to build the necessary infrastructure to bring natural gas to customers that need it, resulting in reliance on shipments of liquified natural gas from abroad, the high prices and instability that go along with that.”
While U.S. consumers see gasoline prices jumping, continued inflation looming and cold weather bearing down, “our domestic supply of natural gas is keeping Americans warm and bills affordable,” Herbert said.
“We are seeing, in real time, the disastrous fallout from not investing in natural gas. Natural gas customers in Europe are paying the equivalent of $40 per MMbtu because they turned their backs on natural gas and the delivery infrastructure. We should not follow their example.”
Europe has been shutting down gas production over time, and growth in renewables has not generated enough energy to replace it. Other factors contributing to high natural gas prices include governmental policies, high demand due to cold weather and relatively low storage.
Natural gas prices in the U.S. are near $4.50/MMBtu, well below the prices in Europe, which were near $40/MMbtu Friday after rising nearly 51% from Thursday.
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