Australian gas demand could reach 82 TWh this year.
Around 80% of the gas it imports is
currently coming from Russia via Ukraine.
However, Ukraine is unlikely to renew
the transit agreement with Russia
which expires at the end of the year.
Austria will then have to seek alternative sources.
Austria is going to become more reliant on
Western European markets for its gas supply.
So,that's going to be mostly
Germany and also a little bit Italy,
and it will be purchases of spot gas
from those hubs or potentially LNG
that will be transited via those markets instead.
Gas import capacities from Germany and Italy
are expected to rise from 160 to 185 TWh,
due to infrastructural expansion.
And when a new gas link between Germany
and Austria is completed in 2027,
they could climb to 212 TWh.
The markets are very nervous but
I think this is just psychologically driven
and not fundamentally driven, so after
a few weeks the market will calm down again,
but I could expect prices jumping up over EUR 40/MWh.
However, there's also some good news for Austria.
Germany is planning to remove its gas storage
levy which would offset some of the price effect
Yes, so in our in our view, we do expect that
German storage levy to end by the end of this year,
which should make importing gas into
Austria from Germany a bit cheaper.
It is still unclear whether flows
via Ukraine will actually end or
whether a workaround is possible, potentially
involving a third party such as Azerbaijan.
I think on balance it's more than 50% likely
This is one of the kind of key
uncertainties the market's grappling with
and it is a little bit jittery at the moment.
from the loss of Russian deliveries
that those flows stop at the end of the year.
