Gas next winter - no need to panic

As the International Energy Agency forecasts another gas crisis in 2024, let’s look at the facts. There are three reasons why the IEA’s fears may not materialise. First, on the Russia–Ukraine position, it was Russia that decided to turn off the taps, and it can choose to turn them on again. There are good reasons why it may do so, not least because its economy is suffering seriously. Second, LNG (from the US, Qatar and Australia) has created a serious alternative option, and it is in plentiful supply. Third, there is the efficiency factor. The result of high gas prices has been a remarkable reduction in demand and the possibility of a global recession will reduce overall gas demand. Efficiency gains from price shocks tend to be irreversible. These three factors all lead to the real possibility that the IEA's predicted gas price shock is over-stated. While short-term planning for emergencies is important, the wider, more medium-term, requirement is to plan for energy policy reform.