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Geopolitical Risks to the European Gas and LNG Market

The potential impact on Natural Gas markets of the Armenia-Azerbaijan war, the Israel-Hamas war, and the undersea attacks in the North and Baltic Seas


  • There are several, non-obvious, geopolitical risks that will continue to influence the European, and by extension, global natural gas and LNG markets well into 2024.

  • The first is the Armenia-Azerbaijan war, which might directly impact future European gas imports from the region.

  • The second is the Israel-Hamas war, which directly impacts Egypt’s ability to export LNG to Europe.

  • The third relates to Europe’s ability to protect its network of gas pipelines in the North and Baltic Seas from Russian and Chinese attacks.

Pivoting Away from Russian Energy Coercion

For many years oil was the defining macroeconomic and geopolitical asset, impacted by wars, monetary policies, and the overall health of the economy. Gas was more linked to physical and regional dynamics, mostly because moving gas around is significantly more complex than moving oil around. This is slowly changing as natural gas supply chains become more globalized and, thus, vulnerable to global events (i.e. geopolitical risk).

Consider this:

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