The earlier three-day closure of the pipeline had already contributed to record spot prices last week, breaking all previous records. State-owned Gazprom, which had been due to restore pipeline operations after three days of ‘maintenance’ on Saturday, blamed the closure on a technical fault, but failed to provide more details. However, the European Commission’s chief spokesman, Eric Mamer, commented on Twitter that it was proof of Russia’s cynicism, “as it prefers to flare gas instead of honouring contracts”, the Financial Times newspaper reported.
Escalating energy prices generally, and gas prices in particular are a major concern for European economies, amongst others, as stocks have not been rebuilt in time for surging energy demand during the winter months ahead. However, record prices are also shaking the foundations of the energy transition, as power plants turn back to coal for fuel, and oil and gas projects previously on hold are quickly back in train.
Prices are also a major concern for the growing number of owners who have opted for dual-fuel LNG propulsion arrangements for new ship orders. According to figures from Clarkson Research, 37% of contracts over the year to date, 60% in tonnage terms, have involved alternative fuel systems. LNG leads the way, the analysts said, with almost 300 orders so far, equivalent to 38% of tonnage ordered.
The price of LNG bunkers per tonne is now 10 times that of high sulphur fuel oil (HFO) that can be used by a scrubber fitted vessel. Ship & Bunker pegged the LNG bunker price in Rotterdam at $4,545 per tonne on 2 September compared to $679 per tonnne of VLSFO, and $455 per tonne for IFO380 HFO in the same port.
Methanol orders also featured on Clarkson’s list, as well as battery hybrid arrangements for smaller vessels. More than 70 ‘ammonia ready’ contracts had also been placed this year. Energy saving technologies (ESTs) and related retrofitting opportunities for equipment suppliers and repair yards are also trending upwards, the analyst said.
The deepening energy crisis comes as SMM is set to open doors to the world’s shipping community in Hamburg for the first time in four years.
It also coincides with the launch of DNV’s latest ‘Energy Transition Outlook 2022 – Maritime Forecast to 2050’ in Hamburg on Tuesday. Since the last edition was published, both the energy transition and energy security more generally have been fundamentally undermined in ways that could hardly have been imagined 12 months ago.
