IEA: A Dog That Hasn't Barked (at Germany)

You’ll often see pronouncements from the International Energy Agency being cited by all manner of differing parties & factions as authoritative & well-respected etc.  It is.  But it is also politically, errr, coy.

A note on the history.  Back in 1973 when the Arab-Israeli war (part 94) kicked off and the First Oil Crisis ensued, OPEC instituted an embargo – a blacklisting of certain importing nations (including the Netherlands for some reason I forget) which had a highly disruptive effect on world oil supplies.  The North Sea was in its infancy as regards oil production, and the UK was heavily affected, among many other western nations.  In order to coordinate the free world’s oil supplies, the OECD in Paris set up an ad hoc group that did the business rather successfully (I’ve written about it here and here), encouraging all concerned to establish it permanently as the IEA**.   Although the moniker was ‘energy’ its early focus really was oil, and it staffed up with some very excellent oil people from around the western world.

By the 1990s a new concern was emerging.  Despite US opposition from the very start, Western Europe had become heavily dependent upon Russian gas supplies, notably Germany getting around 35% of its gas from Gazprom and rising (it’s 40% now – not so very different); and of course former eastern-bloc countries even worse.  Although the Berlin Wall had well and truly fallen, the potential for disruption to gas flows from the east was starting to cause unease.  This was a bit left-field for some people, because (a) Russia had been at great, nay massive pains to be a really reliable source, cheerfully cutting off gas for its own people if needed to keep hard-currency exports going, even in the depths of winter: and (b) this was a lot more than could be said for the Netherlands, another big supplier to Germany, and statistically by far their most unreliable source.  Interruptions from Russia tended to be local to one pipeline, accidental in nature, and ultra-short-lived.  Everyone concerned had built substantial gas storage facilities to iron those out, and nobody ever really saw the need to make much of a fuss.

So in 1994-95 the IEA conducted a very thorough review on security of gas supply.  The resulting publication concluded that all major European countries could withstand one winter of curtailment of their single biggest source of supply, albeit potentially requiring massive switching to oil (which was far more substitutable back then than nowadays) and also shutdowns in industry.  The countries that couldn’t withstand it were basically Ireland (dependent on supplies from the UK) and Portugal: the Baltics and Balkans were not included in the study (it was 1995).  The IEA made a number of recommendations, high on the list being: to liberalise the European gas market; debottleneck a large number of local pinch-points in the pipeline system; engineer reverse-flow options in many pipelines (easily done); and diversify import sources, especially via LNG.  All of these steps were taken, with the glaring exception being that Germany declined to involve itself in LNG: as pointed out here before, the sainted Merkel didn’t commission a single LNG terminal in her entire reign, being wedded to the active-appeasement policy of Russenverstehen, so Germany still has none.  

The IEA 1995 publication was diplomatically worded, with not a hint that Russian political considerations might be lying behind the concerns.  But I can assure you, they were.

They’ve updated that report many times since, mostly recently 2020-21.  Then, the preoccupation was post-covid recovery plans.  So far as I can see (and I haven’t trawled every single edition) the IEA has never troubled itself to speak openly about the concerns over Russia that I know for a fact they’ve harboured, and analysed, for nearly 30 years.  Right up until publication of a 10-point Plan++ in March of this year, that is – with a hint of concern being voiced as early as, oooh, January. 

OK, the OECD is a lumbering political beast.  But why nothing publicly from the IEA before March 2022?  We have to suspect a German veto at work.   C’est la vie.  And all a bit circular, really …  Germany’s got a problem but, oops, they’d rather we didn’t mention it.

“As the world’s leading energy authority, the IEA will continue to serve as a focal point for global dialogue on how to ensure a secure and sustainable energy future.“

Well speak up then, matey!

ND

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** not to be confused with America’s EIA – also very authoritative

++ actually, they slip in Point #11 as an afterword:  maximise oil substitution for gas.  This won’t yield nearly as much as it would have back at the time of the 1995 plan, but it’s still material.  But, as they coyly mention, it might not be consistent with Net Zero 2050 …