Mediterranean Economies 2023
DOI: 10.1401/9788815411167/c4
4.EU energy dependency on oil and natural
gas imports and security of energy supplies: the current
situation and possible developments in times of uncertainty
caused by the pandemic and the Russian-Ukrainian war by Irene Bosco and Giovanni Canitano
Notizie Autori
Irene Bosco University LUMSA (i.bosco.dottorati@lumsa.it).
Notizie Autori
Giovanni Canitano CNR-ISMed, National Research Council,
Institute for Studies on the Mediterranean (canitano@ismed.
cnr.it).
Abstract
The current subpart is about EU
energy dependency and investigates the dynamics of
the commercial trade in energy sources in the Med
area and in MENA countries, considering the
consequences of the COVID-19 pandemic and the
Russian-Ukrainian conflict. The authors mainly focus
on the exports and imports of fossil fuels, but also
analyse the dynamics of the renewable energy
market.
Introduction
With its strategic
geographic position and concentration of energy sources, the
Mediterranean basin plays a key role in energy provision for
countries worldwide. Trade from the MENA region, noted for its
rich oil and natural gas reserves, crosses the Mediterranean,
bound especially towards EU member states, some of its main
customers [Forte and Canitano 2019].
This paper
investigates the development of the trade in energy sources in
the most recent years, taking into account the effects of the
COVID-19 pandemic and the Russian-Ukrainian conflict.
Moreover, it extends
its focus to future scenarios, studying in depth the consumption
trends not only of fossil fuels but also of renewable energy.
The study involves countries of the MENA region as the main
energy providers, and European countries along the Mediterranean
basin as the main importers. Specific consideration will be
given to France, Italy and Spain as major European countries
overlooking the Mediterranean.
The paper focuses on
the exports and imports of fossil fuels, since they still
represent the principle energy sources used. References will be
included about the degree of energy dependency on foreign
countries and the changes dictated by the need to deal with the
supply shortfall due to the conflict in Ukraine which has
modified general political relationships between European
countries and foreign countries.
The chapter is
structured as follows: the first part is devoted to the current
and future consumption of energy sources followed by the effects
of the recent pandemic and the ongoing Russian-Ukrainian
conflict. Section 3 examines the MENA region and its resource
provision and supply. Finally, section 4 focuses on the
¶{p. 114}energy demand of the main Mediterranean
European countries, namely France, Italy and Spain, and their
relations with MENA countries.
Data and
Methodology. The study draws on data
provided by the most trustworthy databases such as British
Petroleum, Eurostat and IAE. The data include information
regarding the overall consumption of energy differentiated by
type, the supply of energy from MENA countries and the energy
demand from European countries. Data cover the most recent
years, mainly the time range 2019-2021, and future trends are
projected until 2050.
1. Analysis of the current context and future scenarios
The overall
consumption of energy differentiated by source is shown in
figure 1. Fossil fuels are still the most commonly consumed
energy source as they were in 2017 despite all the policies that
urge the transition towards renewable energy usage. For example,
the consumption of the most widely used fuel, namely oil,
increased, albeit only by 0.058 per cent, from 2020 to 2021.
It is followed by
coal which recorded a similar increase in consumption (0.060 per
cent). Natural gas is the least consumed fuel with the lowest
percentage variation in consumption among fossil fuels.
Hydroelectric
energy is the most widely consumed non-fossil source, despite
decreasing by 0.020 per cent from 2020 to 2021. Renewable energy
consumption has moved in the opposite direction, recording the
largest increases and thereby showing the effectiveness of
policies in the energy transition. Lastly, nuclear energy is the
least widely used source of energy whose consumption rose by
only 0.035 per cent in the period in question.
From a future
perspective, two kinds of scenarios, provided by the BP Energy
Outlook 2022, can be analysed. The «Accelerated» and «Net Zero»
scenarios both aim to reduce carbon emissions.
The Net Zero
scenario includes the behaviour of society and its preference
for low-carbon energy consumption. These two scenarios are shown
in figure 2, respectively for the year 2040 and 2050.
According to the
Accelerated scenario, the trend in renewable energy consumption
in 2040 records a sizable increase (138 per
¶{p. 115}cent), a much higher rise than that
recorded by electricity consumption (43.8 per cent). By
contrast, consumption of fossil fuels is predicted to decrease
both in 2040 and 2050, signalling the commitment of countries to
reduce CO2 emissions by consuming green
energy. The above consumption is expected to decrease by 34.4
per cent in 2040 and 37.9 per cent in 2050 which represents a
constant but significant reduction. Consumption in renewable
energy and electricity is also expected to increase over the
next 20 years.
Source: elaboration by the
authors on data from British Petroleum (2022),
Statistical Review of World Energy
2022.
¶
Source: elaboration by the
authors on data from the British Petroleum Energy
Outlook 2022.
The Net Zero
scenario shows the same consumption paths of the three energy
sources. By 2040, consumption of renewable energy and
electricity is expected to grow even more than predicted by the
Accelerated scenario (165.7 per cent and 68.6 per cent,
respectively). Under the Net Zero scenario, the consumption of
fossil fuels is expected to decrease by 48.5 per cent, a
contraction that is greater than that forecast in the
Accelerated scenario. The trends maintain their sign also in
2050, the year in which the usage of renewable energy and
electricity is still expected to record an increase and the
consumption of fossil fuels is expected to decrease by 49 per
cent.¶{p. 117}
Summing up, until
2021 fossil fuels remained the most widely used energy source
whose consumption also recorded an increase despite the greater
increase in renewable energy usage. This means that the
transition towards renewable energy is becoming increasingly
significant thanks to green economy policies despite the
difficulty in reducing the consumption of fossil fuels. Oil
represents the primary energy source, followed by coal and
lastly by natural gas. In particular, oil and natural gas are
the fuels whose supply is mostly provided by the MENA region
which will be analysed in more detail below.
According to the
future perspectives, what the Accelerated and Net Zero scenarios
suggest is overall growth in the usage of renewable energy which
is fundamental to meet carbon dioxide reduction targets. The
latter is also enhanced by the decline in fossil fuel usage
which would become the least consumed energy source.
2. Focus on business shocks: the effects of the COVID-19 pandemic and Russian-Ukrainian conflict
The economic
difficulties currently being experienced are the result of two
recent shocks that have created significant upheavals worldwide,
making it difficult for countries to deal with the social and
economic damage reported in the short term. The spread of the
COVID-19 virus and the consequent outbreak of the pandemic
affected the economy both on the demand and supply side, causing
an upheaval in household consumption and firms’ production. The
contraction in supply and hence in production of goods and
services meant a reduction in the usage of primary resources.
The fall in energy
consumption is shown in figure 3 which displays side by side the
reduction in GDP in the years hit by the pandemic, namely 2020
and 2022. The year 2020 is associated to the outbreak of the
pandemic, a shock whose magnitude has never been recorded
before. In this year, a fall of –2.6 per cent in global GDP
which corresponds to a sharp contraction in energy consumption,
about –2.7 per cent which is dictated by the reduction in the
demand side rather than supply. The year 2022 saw a recovery in
the total final consumption of energy
¶{p. 118}which recorded a growth of 0.5 per cent
despite the degrowth of global GDP (–1.6 per cent).