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The European energy crisis and the consequences for the global natural gas market

Author

Listed:
  • Simone Emiliozzi

    (Bank of Italy)

  • Fabrizio Ferriani

    (Bank of Italy)

  • Andrea Gazzani

    (Bank of Italy)

Abstract

The Russian invasion of Ukraine in February 2022 led to severe disruptions in the European gas market, with significant repercussions on a global scale. The conflict caused a surge in energy prices, a major reshuffling of global natural gas flows, and a shift in the policy-makers' agendas towards energy supply security. This paper describes the global gas market and analyses the consequences of the war, focusing in particular on the European gas market and on global LNG trade flows. We first review the characteristics of the gas market in terms of both pricing benchmarks and contractual terms. Next, we analyse the changes to LNG and natural gas production, consumption, and trade flows throughout the 2022-23 energy crisis. Finally, we review the main policy response to the energy crisis and present some considerations on the gas market outlook.

Suggested Citation

  • Simone Emiliozzi & Fabrizio Ferriani & Andrea Gazzani, 2023. "The European energy crisis and the consequences for the global natural gas market," Questioni di Economia e Finanza (Occasional Papers) 824, Bank of Italy, Economic Research and International Relations Area.
    • Handle: RePEc:bdi:opques:qef_824_23
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    2. Tiziano Balaconi & Aldo Glielmo & Marco Taboga, 2025. "Natural-gas storage modelling by deep reinforcement learning," Papers 2511.02646, arXiv.org.
    3. Zhangying Li & O-Chia Chuang & Rangan Gupta, 2026. "The Shifting Dynamics of Energy Supply Shocks: Natural Gas as the New Driver of European Stock Market Volatility," Working Papers 202609, University of Pretoria, Department of Economics.
    4. Balthazar de Vaulchier & Lionel Fontagné & Yu Zheng, 2026. "What if? Revisiting the Macroeconomic Impact of the Energy Crisis with Peak-load Electricity," Working Papers 2026-03, CEPII research center.
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    7. Candila, Vincenzo & Petrella, Lea & Andreani, Mila, 2025. "Mixed-frequency Quantile Regression Forests for Value-at-Risk forecasting," Energy Economics, Elsevier, vol. 149(C).
    8. Wade, Brendan & Carthy, Philip & Farrell, Niall, 2026. "Price elasticity of residential natural gas demand: Evidence from population microdata in Ireland," Papers WP824, Economic and Social Research Institute (ESRI).
    9. Alessandri, Piergiorgio & Gazzani, Andrea, 2025. "Natural gas and the macroeconomy: Not all energy shocks are alike," Journal of Monetary Economics, Elsevier, vol. 151(C).
    10. Ghelasi, Paul & Ziel, Florian, 2025. "From day-ahead to mid and long-term horizons with econometric electricity price forecasting models," Renewable and Sustainable Energy Reviews, Elsevier, vol. 217(C).
    11. Olmez Turan, Merve & Gilbert, Ben & Flamand, Tulay, 2025. "How good are weather shocks for identifying energy elasticities? A LASSO-IV approach to European natural gas demand," Journal of Commodity Markets, Elsevier, vol. 39(C).
    12. Michał Rubaszek & Karol Szafranek, 2025. "The European energy crisis and the US natural gas market dynamics: a structural VAR investigation," International Economics and Economic Policy, Springer, vol. 22(1), pages 1-22, February.
    13. Theodore Tsekeris, 2025. "Transformations in the European Gas Supply Network Due to the Russia–Ukraine Conflict," Energies, MDPI, vol. 18(7), pages 1-21, March.
    14. Nikou, Vasilis, 2025. "From exit to exposure: Gas import shocks and macroeconomic asymmetries in the wake of Europe's coal phaseout," Energy, Elsevier, vol. 335(C).
    15. Drăcea Raluca-Mihaela & Cristea Simona Mirela & Nimerenco Ina & Teodor Cristian, 2025. "Interactions and Shocks in Energy Markets – Empirical Evidence from VAR Modeling," Proceedings of the International Conference on Business Excellence, Sciendo, vol. 19(1), pages 5149-5171.

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    Keywords

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    JEL classification:

    • L95 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Gas Utilities; Pipelines; Water Utilities
    • P28 - Political Economy and Comparative Economic Systems - - Socialist and Transition Economies - - - Natural Resources; Environment
    • Q35 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Nonrenewable Resources and Conservation - - - Hydrocarbon Resources

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