Title: The Fuse | Europe's Oil Import Dilemma
Headings: Europe’s Oil Import Dilemma
Europe’s Oil Import Dilemma
Guest Post by Peter Kiernan | @peter_kiernan |
Peter Kiernan is Lead Analyst, Energy at the Economist Intelligence Unit
EU oil demand is substantial, but falling
As EU supply falls import dependence stays high
Dealing with oil demand
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Content: Even by including Norwegian output as domestic European supply, Europe’s import dependence still only falls to around 80 percent. Europe is therefore facing a future of dependence on oil imports from outside the region. The bulk of EU oil imports originate from Russia, other FSU countries, and the Middle East and North Africa. Russia is a major exporter of oil to Europe, as it is for natural gas, and last year it was the source of 29 percent of the EU’s oil imports (around 2.9 mbd). Norway (13 percent), Saudi Arabia (9 percent), Nigeria (9 percent), Kazakhstan (6 percent) and Iraq (5 percent), Algeria (4 percent) were other major suppliers. Iran supplied around 6 percent of the EU’s oil imports in 2011 (before sanctions were imposed), around .6 mbd. Libya supplied 11 percent of Europe’s oil imports in 2010, the year before the anti-Ghadhafi uprising, and Libyan supply has been volatile since. In total, the EU imported 10 mbd of crude oil in 2014. Although Europe has been able to replace the loss of Iranian and Libyan barrels in the last few years, there are still energy security and economic implications of Europe’s high rate of oil import dependence. Indeed, despite oil demand contraction, the EU’s import dependence has actually increased and in 2013 petroleum imports cost EU member states around 300 billion euros.