Germany and Russian gas... What are the risks of stopping it and the alternatives available?

BERLIN

- The effects of the Russian attack on Ukraine have spread to most regions of the world, as the two countries possess enormous underground and agricultural wealth that the whole world needs, not just the European continent.

In addition to his military attack, there are other weapons that Russian President Vladimir Putin began using in his war, to impose a reality on the ground through them, foremost of which are the energy weapon, and in the forefront of which is gas exported to Europe.

Russia is the world's number one gas producer, with exports of about 200 billion cubic meters in 2020.

Its gas reserves are estimated at 48.9 trillion cubic meters, which made its European neighborhood, which has a cold winter, in great need of its imports of gas, which is described as environmentally friendly and cheap.

German coal and gas power plant (Getty Images)

Energy war and alternative currency

Since the outbreak of the Russian-Ukrainian war, the conflict seemed to be directed against the European Union in general, and Germany - the major economic power in Europe - in particular, which provided support to the Ukrainian side militarily, and calls escalated within it to increase the military budget to 300%, and it seemed as if a parallel economic war It broke out between Berlin and Moscow.

Shortly before the Ukrainian war, Germany halted the implementation of the Nord Stream 2 gas pipeline project despite its readiness. The German government justified this by looking for alternative means of energy under the pretext of climate protection, while observers interpreted this as Berlin seeking to get rid of Russian dominance in gas supplies, which is imported from Moscow is about 40% of its gas needs.

With the escalation of the Russian-European dispute, Putin surprised the world by requesting that the value of gas exports be paid in rubles, which Germany refused, and announced that the payment would be in dollars or euros, as is signed in the contracts between the two parties.

Muhammad Ghanem: The dispute over the means of payment expresses a Russian desire to change the global monetary system based on the dollar (Al-Jazeera)

The struggle over the monetary system

Regarding Putin’s request to pay the value of energy contracts in Russian rubles and the risks of that on the global currency, the “US dollar,” economist Mohamed Abdel Wahed Ghanem says, “There is no doubt that America was able to tighten its financial control through a monetary system that it imposed on the world by paying in dollars after the Bretton Woods treaty.” 1947, and Europe supported this before its single currency "the euro" appeared, and Germany, although it disagreed with the United States on some economic issues, benefited from the dollar monetary system.

Ghanem believes that the dispute over the means of payment in dollars expresses a desire to change the monetary system and get rid of the dollar's control, and this is not allowed by the United States, as changing it would lead to the collapse of America and a world war.

Ghanem told Al Jazeera Net that Putin is trying to use the means of payment as a weapon, especially since it is the number one gas producer in the world, as well as Russia's massive oil production, which reached 11.60 million barrels per day last February.

This step, says the economist, is a declaration of a world war, especially since America, since the early seventies, has depended for the strength of its currency on what is known as the petrodollar, that is, linking the value of purchased oil to the US dollar.

Germany alternatives

Although the United States and its allies imposed multiple sanctions on the Russian energy sector, this did not include Europe stopping the import of Russian gas, especially the two important industrial countries, Germany and Italy.

In the face of the escalation of the Ukrainian crisis and Putin's request to pay the value of gas in Russian rubles, the German government began working on a strategic plan to stop relying on Russian gas and move towards other alternatives.

According to the British Financial Times newspaper, the German government announced its first steps to ration gas with an emergency plan based on 3 stages, the first in which a crisis team from the Ministry of Economy and the private sector implements harsh measures to reduce consumption, and if the crisis continues, gas is cut off from certain sectors and preferential treatment for families .

Meanwhile, experts have warned that the escalation of the gas crisis will push the inflation rate in Germany to 6.1% this year.

Energy expert Samer Rahal spoke about Germany's alternative solutions (Al-Jazeera)

Risks and solutions

And about the risks that Germany will face if it decides to stop importing Russian gas, and the solutions offered by its government, Al Jazeera Net asked German energy expert Samer Rahal.

Rahal says the German Energy Industries Association has declared that the early warning of the Russian gas emergency plan is justified in light of the dispute over which currency will pay for Russian gas shipments.

This "dangerous development", as Rahal describes it, makes the joint work of all German federal agencies and companies in the private sector even more urgent, to reduce the economic damage in the event of a shortage in the supply of Russian gas.

It is unclear what will happen to the industry when gas is scarce.

The biggest danger here is the sudden disruption of supply chains, which in turn will lead to machines not working, massive damage to production facilities, and massive loss of their jobs, which means serious social problems that the federal government may not be able to manage.

Therefore, the Federation of Energy Industries renewed its demands to use coal as an alternative to natural gas in power plants for a limited period of time and only during the current crisis.

According to experts, this is possible immediately, and will preemptively reduce the demand for natural gas, regardless of the possible shortage of gas.

In the context of alternative solutions as well, Rahal says, "If we exclude the option of returning to nuclear energy, the government should build a liquefied gas plant in the north, accelerate alternative energy plans such as green hydrogen, import liquefied gas from the United States, Qatar and Algeria, and expand the construction of wind energy fields, Extending the period of reliance on coal in power plants.