Situation in Middle East and North Africa increases attractiveness of Caspian energy resources

Caspian gas looks for the EU markets as a more reliable alternative to supplies from Middle East and North Africa, editor-in-chief at Eurasia Energy Observer Andrej Tibold said.

"It is very likely that we have not seen the end of instability in the MENA region for some time to come. Possibly it could spread beyond the current areas of instability," Tibold said via e-mail.

In light of this Caspian gas looks as a more reliable alternative for the EU markets, he said.
He said however, Caspian gas needs to find its way to these markets, preferably via the Southern Corridor.

The Southern Corridor is a priority EU energy project. It will diversify energy supply routes and resources, and increase EU energy security. The Southern Corridor includes the Nabucco gas pipeline, Trans Adriatic Pipeline (TAP), White Stream, and ITGI (Turkey-Greece-Italy pipeline).

Tibold said another determining factor will be the price of Caspian gas.

"Buyers in the EU are less and less prepared to conclude oil indexed contracts," he said.
He said Libyan gas supplies to the EU, mostly to Italy, are being substituted by Russian gas.
"If Caspian gas is offered at more competitive prices than Russian gas it has a good chance to acquire attractive market shares," said Tibold.


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