Germany, US halt Nord Stream 2 pipeline over Russia’s Ukraine aggression; EU looks to cut dependence on Russia

Germany halted the permit for the Nord Stream 2 pipeline as a diplomatic measure against Russia, as the latter continues its military aggression against Ukraine. The controversial, $11bn- pipeline was awaiting permits from the German government to allow Russia to export natural gas to much of the EU. The denial of the permit was also backed by sanctions by the US against the parent firm Nord Stream 2 AG and its CEO, Matthias Warnig, even though last year US President Joe Biden had waived the sanctions. 

Surprisingly, support for Biden’s decision has come from Republican senator Ted Cruz, who said that approving the pipeline would have caused “multiple, cascading, and acute security crises for the United States and our European allies”. 

Following the breakout of conflict in Ukraine, the IEA has prepared an ambitious 10-point plan to rapidly reduce Europe’s dependence on Russian oil and gas by the end of the year, while remaining on track to eliminating it completely by the end of the decade. The plan is likely to be used extensively to design near-term energy strategies in Europe in light of heightened tensions between continental Europe and Russia.

OPEC members to slowly increase oil supplies despite fears of shortage over Russia-Ukraine 

Members of OPEC announced that they would only modestly increase the supply of oil in the next few weeks, despite the fears of a global shortage of the commodity driving up oil prices to as high as $119/barrel. The rally comes as a result of Russia’s military action against Ukraine and the possibility of its oil and gas exports being frozen as retribution, which would take away nearly 8-10% of the global oil supply. IEA members are also reported to have agreed to releasing more oil — as much as 60 million barrels per day — and most of it is likely to come from the US, in a bid to prevent an uncontrolled rise in oil prices. 

Another factor in the works is reportedly a pending decision on Iran’s sanctions over its nuclear ambitions, which if waived in March, could unlock more oil from its wells and lower the price of the fuel in the immediate short-term. 

Russia, China to ink deal to supply 100mn tonnes of coal 

The Russian and Chinese governments were reported to be working on a deal that would see Russia export 100 million tonnes of coal to China every year in the near future. The deal stems from the apparent reduction in coal supplies — and extraction — from other countries, and the Russian energy minister backed the deal by saying that countries should receive “as much coal as they need”. Also, the country’s energy ministry is eyeing the growing energy demand from the Asia Pacific region and aims to supply more coal to the region through 2030. Incidentally, Russia’s share in the region’s coal supplies has grown from 4% in 2010 to 12% in 2021. 

HSBC announces target to slash emissions from clients’ projects by 34% by 2030

Leading financier HSBC announced on February 22 that it had adopted a new target: its clients would have to report at least a 34% reduction in emissions from their oil and gas projects by 2030. The decision will also stress absolute reductions in emissions, including a 75% drop in carbon intensity from the power sector (primarily coal power), and this could greatly influence fossil energy financing by other large banks. HSBC had previously committed to zet-zero emissions by 2050 amongst all its customers. 

Yet, Market Forces, an environmental campaign group, argued that the decision left loopholes for HSBC as it could still finance new oil and gas projects while only restricting financing for “on-balance sheet” emissions. 

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