WEMO24-Compiled Report-Interactive compressed (002) 4154-7882-8116 v.1 - Flipbook - Page 7
Global
Outlook
This contrasts sharply with the energy crisis at the end of 2021
and 2022 when prices reached historic highs.
Electricity prices for energy-intensive industries in the European
Union in 2023 were almost double those in the USA and China.
Despite an estimated 50% price decline in the European Union
in 2023 versus 2022, Energy Intensive Industries6 in Europe
continued to face far higher electricity costs compared with
their American competitors. The price gap between energyintensive industries in the European Union and those in the
USA and China, which already existed before the 2021-2022
energy crisis, has widened. As a result, the competitiveness
of EU Energy Intensive Industries is expected to remain under
pressure.7
FIGURE 2
Number of negative hourly wholesale prices in Europe
1400
1200
1000
800
600
Jul 2020
Jan 2021
Jul 2021
Jan 2022
Jul 2022
Jan 2023
IE - Ireland
IP - I berian Peninsula
SEE - South Eastern Europe
CEE - Central Eastern Europe
CWE - Central Western Europe
NE - Northern Europe
Jul 2023
Source: ENTSO-E
6 Energy Intensive Industries are: food, pulp and paper, basic chemicals, refining, iron and steel,
nonferrous metals (primarily aluminium), and non-metallic minerals (primarily cement).
7 For example energy costs account between 20% and 40% of the total cost of steel production.
8 World Energy Market Observatory 2023 edition https://www.capgemini.com/insights/
research-library/world-energy-markets-observatory/
9 https://www.atlanticcouncil.org/content-series/russia-tomorrow/oil-gas-and-war/
10 https://energyandcleanair.org/russia-sanction-tracker/
After the unjustified invasion of Ukraine by Russia, the EU and
other G7 countries-imposed sanctions on Russian oil and coal.
Meanwhile Russia cut nearly all the piped gas that it exported
to the EU.8
It seems that EU and G7 sanctions including embargo on Russian
coal, oil and oil products have had a significant impact on the
Russian oil and gas industries and on the related budgetary
revenues that come from them.9 10
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WEMO 2024
After a huge increase in 2021-2022, European gas prices returned
to their pre-crisis level in 2023.
Thanks to the USA shale gas production, gas in this country is
around five times cheaper than in Europe giving (as for electricity
usage) a strong competitive advantage to USA firms.
400
0
Jan 2020
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