Prices For Additional Algerian LNG Supplies Will Rise

An Italian official stated that his country could turn to Algeria and other countries, including Australia and the United States, for additional liquefied natural gas (LNG) supplies amid the crisis following the war in the Middle East. However, he acknowledged that prices would rise. This comes as Snam, the company responsible for Italy’s domestic gas network, revealed that Algeria accounts for 34% of Italy’s gas imports, making it the primary supplier.

In this context, Gianni Morano, president of the Italian Association of Fuel Companies, stated in remarks recently reported by the ANSA news agency, “For Italy, the situation is critical regarding liquefied natural gas (LNG). We import 9 billion cubic meters from Qatar, representing 50% of our LNG imports and 12% of our total gas imports. With the Strait of Hormuz closed, we could turn to other countries such as the United States, Australia, Algeria, or Egypt, but prices would rise.”

Morano added, “The price of diesel has risen dramatically following the war in Iran, with an increase of 10% per litre, or 18%.” He noted that Europe is experiencing a diesel shortage due to the closure of some domestic refineries.

According to him, refined products can be purchased from other countries, but China is facing the same issue and is seeking other suppliers, which is driving up prices. He noted that the increase in gasoline prices was less pronounced, at only 3 cents, and stressed that the duration of the war would have a decisive impact on prices.

In the same context, recent data released Tuesday evening by Snam, the company responsible for operating and managing Italy’s domestic gas network, revealed that Algeria is Italy’s primary gas supplier, having secured more than a third of the country’s gas supplies and gradually replacing Russia since the start of the conflict in Ukraine.

According to the same data, Algeria supplied Italy with approximately 280 gigawatt-hours (GWh) of gas out of its total gas imports of 824 GWh. This gas was supplied via the Transmed (Enrico Mattei) pipeline, specifically in the Mazara del Vallo area of Trapani, Sicily. This is in addition to approximately 30.62 GWh from domestic production and 220.6 GWh from reserves, bringing the total national gas supply to over 1,075 GWh.

According to Snam, Algeria continues to maintain its clearly leading position, coming in first with supplies of around 280 GWh, far ahead of its closest competitors, followed by the stocks of Sojitz with 187.3 GWh, then the LNG processed at the Cavarzere station with 129.37 GWh, and in fourth place, Azerbaijan’s supplies via the TAP pipeline with 124.47 GWh, followed by the quantities processed at the Livorno station with 68.62 GWh.