The Last Winter of Gas in Europe

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The Last Winter of Gas in Europe

31 March 2023 by Collective

Português

We will not sit idle while governments across the political spectrum repeatedly choose the path of collapse and continuous social and economic crises in order to save the fossil fuels industry.

While hundreds of activists blockade the European Gas Conference in Vienna to stop further climate chaos and poverty, we call on all movements and organizations to push back against the power of the fossil fuels industry. To end the cost of living crisis and avert climate chaos, we need to guarantee the rapid phase-out of fossil gas in Europe and to build a new energy system for people and planet. Next winter needs to be the Last Winter of Gas in Europe.

The spike in energy prices that started in autumn 2021 as Covid lockdowns began to ease kicked off the spiral of inflation Inflation The cumulated rise of prices as a whole (e.g. a rise in the price of petroleum, eventually leading to a rise in salaries, then to the rise of other prices, etc.). Inflation implies a fall in the value of money since, as time goes by, larger sums are required to purchase particular items. This is the reason why corporate-driven policies seek to keep inflation down. we are still living through. Today’s cost of living crisis has been provoked by a fossil fuel sector that has made record-breaking profits as a result. Last year Saudi Aramco announced $161.1 billion in profit Profit The positive gain yielded from a company’s activity. Net profit is profit after tax. Distributable profit is the part of the net profit which can be distributed to the shareholders. , ExxonMobil $59 billion, Shell $40 billion, and TotalEnergies $36 billion, to name just a few.

These obscene profits have led to massive inflation across a global economy deliberately made dependent on fossil fuels, in particular on fossil gas. According to the International Energy Agency (IEA), fossil gas alone is responsible for more than 50% of the rise in average costs of electricity generation. Add to this corporations opportunistically increasing their prices under the guise of inflation and you have the cost of living crisis: massive price increases in food, transport, essential goods, housing, in short, in everything.

Last year we lived through the hottest summer in Europe in the last 500 years, the biggest drought in the history of China, and floods that devastated a third of the territory of Pakistan, killing thousands and affecting 33 million people. That is the level of climate, environmental and social destruction we are already living through today.

The invasion of Ukraine by Russia in February 2022 guaranteed free rein for hoarding and speculating. The forces behind the crises already in motion were unleashed. The partial shutdown of the gas flow from Russia to the European Union was used by the fossil fuel industry to push back on the already-meagre advances made in emissions reduction targets. Once-defeated gas infrastructure projects were revived, new LNG ports built, camouflaged ‘hydrogen-ready’ pipelines approved, all extending the profitability of the sector for decades to come. Energy diversification in Europe meant changing gas supplies from Russia to the United States, to Saudi Arabia, Qatar, the United Arab Emirates, Nigeria, and pushing forward with catastrophic projects such as the East African Crude Oil Pipeline (EACOP) or LNG from Mozambique’s Rovuma Basin, also fuelling the expansion of fracking in a new round of reinforcing monopolies, neocolonialism and the devastation of communities.

The energy and subsequent cost of living crisis have been used to revive the fossil fuel industry, fully paid for by the peoples of this world under the strangle-hold of fossil capital and its monopolies. The crisis has been further aggravated by central banks choosing to increase interest rates Interest rates When A lends money to B, B repays the amount lent by A (the capital) as well as a supplementary sum known as interest, so that A has an interest in agreeing to this financial operation. The interest is determined by the interest rate, which may be high or low. To take a very simple example: if A borrows 100 million dollars for 10 years at a fixed interest rate of 5%, the first year he will repay a tenth of the capital initially borrowed (10 million dollars) plus 5% of the capital owed, i.e. 5 million dollars, that is a total of 15 million dollars. In the second year, he will again repay 10% of the capital borrowed, but the 5% now only applies to the remaining 90 million dollars still due, i.e. 4.5 million dollars, or a total of 14.5 million dollars. And so on, until the tenth year when he will repay the last 10 million dollars, plus 5% of that remaining 10 million dollars, i.e. 0.5 million dollars, giving a total of 10.5 million dollars. Over 10 years, the total amount repaid will come to 127.5 million dollars. The repayment of the capital is not usually made in equal instalments. In the initial years, the repayment concerns mainly the interest, and the proportion of capital repaid increases over the years. In this case, if repayments are stopped, the capital still due is higher…

The nominal interest rate is the rate at which the loan is contracted. The real interest rate is the nominal rate reduced by the rate of inflation. , meaning more people evicted from their homes, more foreclosures, bankruptcies, and unemployment. All investment currently made into fossil fuels guarantees Guarantees Acts that provide a creditor with security in complement to the debtor’s commitment. A distinction is made between real guarantees (lien, pledge, mortgage, prior charge) and personal guarantees (surety, aval, letter of intent, independent guarantee). continued dependency, a continued cost of living crisis and an increasingly catastrophic climate crisis.

We are only at the beginning of our troubles, as crises multiply and intensify, with possible contagion to the financial sector. The decisions made by governments and central banks, of expanding gas infrastructure and increasing interest Interest An amount paid in remuneration of an investment or received by a lender. Interest is calculated on the amount of the capital invested or borrowed, the duration of the operation and the rate that has been set. rates are not any sort of lesser evil, they are the root of evil. Fossil fuel companies are making such eye-watering profits because governments have refused to use their political power, instead handing it over to fossil gas CEOs. The cost of living crisis, like the climate crisis, is unsolvable if fossil fuel dependence doesn’t end. We are not in the same situation as ten years ago, we don’t have time to be once again fighting against new massive Oil & Gas projects worldwide: we must end this industry this decade.

As hundreds use their bodies to block the European Gas Conference in Vienna these past days, behind its closed doors oil and gas executives have been working hand-in-hand with top government officials to protect shareholder’s investments and maintain the suicidal path towards climate chaos. We need to stand up to profit and power everywhere, in particular to fossil capital.

In order to stop the cost of living crisis and avoid climate chaos, we need the fast phase out of fossil gas, quickly followed by oil and coal. We need the Last Winter of Gas in Europe to happen in 2023-2024. When we reach the end of this decade, we need to be looking back at fossil gas as a distant memory.

There will be technical difficulties, as today’s system is based on an addiction to fossil fuels, but this is first and foremost a political question. We will not sit idle while governments across the political spectrum repeatedly choose the path of collapse and continuous social and economic crises in order to save the fossil fuels industry. We call on all movements and organisations to push back against the forces of chaos and usher in the Last Winter of Gas.