Natural Gas markets in the European Union: Testing Resilience

Bartelet, Henry, and Mulder, Machiel (2020) Natural Gas markets in the European Union: Testing Resilience. Economics of Energy & Environmental Policy, 9 (1). pp. 185-205.

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The liberalization and integration of natural gas markets in Europe have resulted in gas-to-gas competition on a European scale with closely related natural gas prices in the various markets. More recently, the European Union aims to become a resilient energy union which may call for additional policy measures. In this paper we discuss the need for such additional measures on top of the existing measures to liberalize and integrate markets. We test the hypothesis that the European natural gas market is resilient to adequately deal with external shocks by analyzing the five most dramatic supply disturbances in the European natural gas markets over the past decade. We find that the natural gas markets were able to trigger responses by market parties which prevented forced supply of gas to consumers in almost all cases. In one case, infrastructure bottlenecks prevented market players to adequately respond to a shock. Hence, we conclude that the best policy to create a resilient energy union is to further integrate European markets and to further remove barriers for market participants.

Item ID: 73433
Item Type: Article (Research - C1)
ISSN: 2160-5890
Copyright Information: © 2019 by the IAEE. All rights reserved
Date Deposited: 08 Jun 2022 01:50
FoR Codes: 38 ECONOMICS > 3801 Applied economics > 380102 Behavioural economics @ 100%
SEO Codes: 17 ENERGY > 1703 Energy storage, distribution and supply > 170399 Energy storage, distribution and supply not elsewhere classified @ 100%
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