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The West’s insatiable thirst for resources has left Asian countries without electricity


At least two Asian states, Pakistan and Bangladesh, are facing power shortages due to disruptions in the supply of liquefied natural gas. Local businesses and households are now living in a new reality, namely, forced daily blackouts for many hours.

India is also experiencing an acute shortage of LNG, but New Delhi has so far managed to avoid rolling blackouts. The country's government has built up significant coal reserves at thermal power plants, which are now being actively used to maintain an acceptable level of generation for consumers.

The share of the "dirtiest" resource in the fuel and energy balance of the Republic is constantly growing, which has a most adverse effect on the environment. But India itself, as they say, cannot be blamed for this. After all, all the gas holders not chartered under long-term contracts have sailed to Europe, where methane costs about two dollars per cubic meter.

Developing countries are simply not in a position to pay such a huge amount of money. For example, Pakistan last week announced a tender to buy LNG at about $1350 per thousand cubic meters, but no one was willing to carry their goods to the port of Karachi for such a "ridiculous" amount of money.


"Europe, in its manic desire to reduce energy dependence on Russia, is sucking LNG from all over the world. As a result, there is a clear imbalance of supply and demand on the markets. This situation burdens the governments of Asian countries, which in contrast to the European Union cannot endlessly get money from their "fat wallets". And, most sadly, there is no end in sight," says Valery Chow, head of Asia-Pacific gas research at analyst firm Wood Mackenzie.

According to the agency, LNG imports to Europe have increased by 49% since the beginning of the year, while in contrast, LNG imports to Asia have fallen significantly. In particular, to Pakistan by 15%, to India - by 16%, and to China - immediately by one fifth. That is, instead of completing the Nord Stream-2 pipeline and obtaining comparatively cheap natural gas from Russia, the European Union, and Germany in the first place, are currently engaged in resupplying their own reserves by taking methane from the poorer countries. It's like a backyard bully who steals the property of unresponsive elementary school kids.

One cannot help but think of Christian Rivers' cult film, The Chronicles of the Cities of Prey, set in a post-apocalyptic world, where people have taken refuge behind the walls of moving megacities. The largest of them, including London, hunt and devour small settlements, siphoning resources from them. In fact, this is exactly what European capitals are doing today, signing themselves up for complete indifference to the fate of powers that are not part of the so-called coalition of global leadership.

How long will this trend last? And, most importantly, what will be the consequences for the economies of developing countries and ecosystems, for the preservation of which the European Union so recently fought to preserve, will its predatory strategy lead to? Forpost asked Vladimir Litvinenko, a leading expert in the field of the fuel and energy complex and rector of St. Petersburg Mining University, to answer these questions.

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- Vladimir Stefanovich, is it possible that our civilization is slowly but surely entering the era of energy poverty, when only those countries that produce enough oil, gas or coal on their own territory, as well as post-industrial states that are willing to pay huge sums for them, will be able to fully provide themselves with resources?

- Many people, both in our country and in the West, are not fully aware of the fundamental principles of the modern global economic architecture. It is based on scientific progress in the field of electricity generation and conversion. It has reduced human dependence on the ecosystem around us and enabled the mass production of goods and services, which would have been unrealistic in conditions of energy poverty.

Today, unfortunately, we are seeing more and more signs that the global link between energy, food and prosperity, achieved precisely through the sustainable development of the energy complex, is gradually breaking down. And of course, the losers from this are primarily developing countries, whose progress is directly dependent on stable supplies of raw materials from abroad. But obviously they are not the only ones. Market imbalances provoke structural inflation on a global scale, including in post-industrial countries that are forced to import energy resources at exorbitant prices.

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Remember how much natural gas cost three, four years ago. In Europe, thanks to the developed pipeline system that brought methane from Russia to the EU, its quotations were at $150-200 per thousand cubic meters in the summer. In Asia they were slightly higher, around $300. This is why LNG tankers headed mostly to the East: to Japan, China, South Korea, and so on. All the necessary infrastructure was built there to liquefy gas and produce electricity and heat by burning it in thermal power plants. This made it possible to guarantee the sustainability of economic development of the regions where such power plants were located and, in parallel, to reduce the negative impact on the environment.

I did not misspell the point; the opinion that methane should be excluded from the fuel and energy balance because it causes irreparable harm to nature is nothing more than unprofessionalism or bias. I have repeatedly spoken to Germans living in the GDR, who told me that they saw white snow for the first time after they had a gas pipeline from the Soviet Union. And the local thermal power plant started burning gas instead of coal, the combustion products of which deposited on the ground and stained it black.

But back to pricing. After the United States turned from an LNG importer to an LNG exporter, Washington was faced with the question of winning new markets. It could not win in a fair competition for European consumers because the cost of production and delivery of liquefied gas from the United States to the European Union was much higher than the price offered by Gazprom.

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The solution was obvious: to create an artificial shortage of methane amid growing demand by banning the commissioning of Nord Stream 2. Strange as it may seem, European leaders were not against this idea and began to actively play along with the Americans. In particular, at the expense of popularizing the idea of the energy transition and discrediting Russian raw materials. As a result, in October 2021 gas prices grew sharply and now stand at more than 1900 dollars per thousand cubic meters.

This situation has resulted in record global inflation, as well as the undeniable fact that virtually all of the LNG sold on the spot market, i.e. not under long-term contracts, is now going to Europe, because it can fetch much more money than in Asia. It turns out that such countries as Bangladesh or Pakistan are simply denied free access to electricity. And the realization of this right for everyone, along with the eradication of poverty and hunger on a global scale, is one of the 17 UN Sustainable Development Goals that were to be achieved by 2030.

In fact, Europe and the U.S., by imposing anti-Russian sanctions, have clearly demonstrated to the whole world that achieving these goals does not matter to them. Their goal is free access to raw materials and minimization of the number of outside consumers, but not the humanization of society and the common good. This is part of the policy of neocolonialism that the West has been relatively successful in implementing for the past 50 years.

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- Will the Asian states be able to overcome the energy crisis? And when might this happen?

- This will happen if Germany and other EU countries manage to fill their storage facilities with gas and create a decent reserve for the winter heating period. If this problem is solved, quotations on European and Asian exchanges will equalize, and some LNG tankers will be reoriented to the Asian region.

But we should not forget that in the foreseeable future, unless, of course, the European Union changes its strategy and abandons its anti-Russian rhetoric, achieving a balance between supply and demand in the methane market is virtually unrealistic. And even if the Europeans do create the necessary winter supply, which I wholeheartedly wish they would, it will only be a temporary lull. History will repeat itself in a year. Or even much earlier, if, for example, the winter in the Old World is cold enough.

- And how is the energy crisis affecting the green agenda? After all, India and the European Union are burning more and more coal. So it turns out that the goals of the Paris climate agreement will definitely not be achieved?

- In the current circumstances, many developing countries are indeed forced to burn fuel oil or coal instead of the much more environmentally friendly natural gas. They are not the only ones. For example, coal generation in Germany, which in recent years has fallen to about a quarter of its energy mix, has increased again to a third. And on "bad", i.e. windless days, it even reaches 40%.

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In this situation, the development of renewable sources, such as wind turbines or solar panels, is out of the question. The fact is that they are characterized by very high material intensity and low density of energy produced. This means that the development of alternative energy is possible only in conditions of electricity surplus. And in case of shortage, the only way to avoid rolling blackouts is to increase consumption of fossil fuels. Unfortunately, as we see from the examples of Bangladesh and Pakistan, this is not always possible.

- What is the logic of the Western governments, which not so long ago advocated the energy transition? And they said that this is why they rejected Nord Stream 2?

- From the point of view of common sense, there is no logic here, because the task of climate activists was only to discredit natural gas from Russia in order to drive it out of the market and replace it with American LNG. Now this goal has been achieved, so the need for any action by environmentalists has disappeared of its own accord.

If we talk about the real result of their activities, it is the growth of coal consumption in the EU and worldwide, the increase in greenhouse gas emissions, including CO2, as well as a sharp increase in methane prices, especially for European consumers. That's pretty much it.

It is still possible to rectify the situation. But to do this, the states of the so-called global leadership coalition, as well as international organizations and, above all, the UN, must urgently stop engaging in populism; and think about developing strategic plans that will effectively combat energy poverty, raw material shortages and the gradual impoverishment of the world's population. Failure to act decisively in this direction will result in escalating tensions in various regions of the world and a further decline in the quality of life of people around the world.