Investment banking and finance company UBS has analyzed the impact of Russian natural gas on Central European countries and Greece and what will happen if Moscow decides to completely turn off the tap.

According to UBS data for 2020, Hungary is most dependent on natural gas imported from Russia. More precisely, Russian gas accounts for 27% of domestic energy consumption, he writes Review of money. The second most dependent country is the Czech Republic, as 18% of its energy needs are covered by imports of Russian natural gas.

Romania, Poland and Greece cover only 7-9% of their energy needs with Russian gas

In other analyzed countries, the risk is lower: Romania, Poland and Greece cover only 7-9% of their energy needs at the expense of Russian gas. “Therefore, these economies have a greater potential to replace Russian natural gas,” UBS analysts note. This concerns Poland, which has stopped receiving Russian gas directly since the end of April. By the way, Poland and Greece are two countries that have floating LNG terminals and have already received liquefied gas from the USA and Qatar.

On the other hand, UBS notes the high dependence on solid hydrocarbons in the energy balance of Poland and the Czech Republic (30-40%), especially the role of coal.

The Czech Republic and Hungary have the largest share of nuclear energy (16-19%), and Greece covers more than 50% of its energy needs at the expense of petroleum products. The country where renewable energy sources play the most important role is Romania (19%).

In terms of sector influence, households have the smallest role in natural gas consumption (relative to total consumption) in Greece (30%) and the largest in Hungary (almost 50%).

The commercial sector and utilities are also important consumers of gas

The commercial sector and public services are also important consumers of gas, with 20% of the total gas consumed in the Czech Republic going to these sectors, while Greece and Poland have the lowest impact, around 10%. Among industries, the chemical and petrochemical industries use the most natural gas as a percentage of total consumption, ranging from 7% in the Czech Republic to 28% in Greece.

High gas consumption is also recorded in the extraction of non-metallic raw materials, the production of food products, beverages and tobacco, as well as in the metallurgical sector. According to UBS, the industry is responsible for 23.5% of the created added value in 4 Central European countries and for 16.5% in Greece. Since Greece imports all the natural gas it consumes, UBS estimates the share of imported gas in the total energy balance at 22%.

The share of Russian gas in total imports is about 40%, while it is 45% in the EU as a whole, and 65% in Germany. Thus, according to UBS estimates, Greece covers about 8% of its energy needs with Russian natural gas, about the same as Romania and Poland, meaning these countries can more easily replace it.

By the way, an IMF study that tries to quantify the possible consequences of Russia turning off the tap shows that the consequences are larger in the case of Hungary and the Czech Republic, but much smaller for Poland, Romania and Greece, the latter of which is only indirectly affected by the effects of its trading partners.

The material was made with the support of the Rador agency