In April 2024, an unprecedented event occurred in Greece: no imports of liquefied natural gas (LNG) were recorded, a first in five years. This absence marks a significant break from previous years, when the country imported between 34,000 and 336,000 metric tons monthly. This trend of increasing imports has significantly reversed despite initial expectations of imports of at least three cargoes, as planned by Desfa in its annual LNG offloading program for economic reasons, with regional prices making the unprofitable option. However, successive revisions of this plan led to a drastic reduction and ultimately the total cancellation of planned cargoes.
Dynamics of Cargo Cancellations
The context of cancellations reveals prudent management in the face of a difficult market environment. Initially, Mytilineos was supposed to import 1 TWh of LNG on April 6, followed by 0.5 TWh by Kolmar on April 12 and another 1 TWh by MET on April 22. However, in a later revision, Kolmar’s slots were replaced with Mytilineos, and the April 22 cargo was canceled. In the latest revisions, the volumes scheduled for April 6 and 12 were reduced to 0.02 TWh each, before these cargoes were also canceled. Penalties for these cancellations, applicable if they occur between 45 days and the delivery date, can reach between 5% and 20% of the cargo size, showing the substantial costs associated with market fluctuations. A market in constant decline unlike that of photovoltaics.
The Growing Role of Pipeline Gas
The fall in LNG imports coincides with an increase in reliance on pipeline gas, which has become a more economically viable alternative. Pipeline gas, mainly supplied by the Trans Adriatic Pipeline (TAP) and imports from Italy, offers a notable cost-effective advantage, especially in comparison with high LNG prices in the spot market. The pipeline’s gas suppliers offer competitive prices, often with discounts compared to the Dutch gas hub TTF, which reinforces their attractiveness compared to LNG, particularly during the off-peak season when demand is lower.
Regional Outlook and Market Reactions
Analysts observe that this situation in Greece could signal a broader shift in regional preferences for energy sources, potentially influencing market dynamics across Southeast Europe. The reactions of other market players, particularly in Italy and Egypt, where new demands for LNG have emerged, should also be monitored. The competitiveness of pipeline gas and adjustments to LNG import strategies in these countries could reveal new trends for the European energy industry in the years to come.
The recession in Greece’s LNG imports in April 2024 serves as a stark example of how price fluctuations and more economical alternatives can radically influence national energy strategies. This phenomenon provides a crucial perspective on the resilience and adaptability of energy infrastructure in a volatile market context and highlights the challenges and opportunities for Greece and the region as a whole.
