Senior Government ministers, including the Taoiseach, are now regularly repeating warnings about a difficult winter ahead. They fear that a cut-off of Russian gas to the EU will lead to yet further sharp price rises for consumers and businesses, or possibly even interruptions to supplies.
The risks to the actual supply of gas are hard to guage; Ireland is not directly exposed to Russian gas but depends on flows through the UK for about three quarters of total supply. In turn, much of this gas comes from Norway. Some Norwegian gas could conceivably be redirected to continental EU markets in the event of an emergency, reducing UK supplies, though the technicalities of this are complicated.
Under existing agreements, the UK is meant to treat Ireland as part of its own market though how this would play out in terms of an ongoing shortage is difficult to judge. But, either way, security of supply also depends on getting access to gas at a reasonable price – and if there are shortages across Europe then costs could soar further.
At the moment, wholesale gas markets are reflecting a worrying outlook, signalling very high prices well into next year. In the short term much will depend on whether supplies from Russia to Germany resume after the reopening of the Nord Stream 1 pipeline, currently closed for maintenance. The German economy is directly exposed and would take an immediate hit from a shut-off. There are plans to reduce reliance on Russian gas, but this will inevitably take time. In the meantime Russian president Vladimir Putin has a powerful, short-term, economic weapon, even if using it threatens Russian revenues.
Having just emerged from Covid-19 shutdowns, the Government here is now faced with further emergency planning for a disrupted gas market. The stakes are high, as many households are already finding energy costs impossible to meet and industry is also exposed. As well as these short-term issues, longer-term questions of energy security need to be addressed openly. A Government paper on the issue is still awaited.