Russia may shut off all gas supplies to Europe in order to increase its political influence in the midst of the Ukraine crisis, warned the president of the International Energy Agency (IEA) on Wednesday, adding that Europe should prepare immediately.

“I wouldn’t rule out Russia continuing to find different issues here and there and continuing to find excuses to further reduce gas deliveries to Europe and maybe even cut it off completely,” IEA executive director Fatih Birol said in a statement to Reuters.

“This is the reason Europe needs contingency plans” Birol said, adding that a recent drop in flows might be an effort to acquire political clout ahead of higher-demand winter months.

According to him, the IEA does not consider a complete cut-off as the most probable option.

The European Union has sanctioned Russian oil and coal but has not banned gas imports, owing in part to its dependence on Moscow for supply.

In terms of overall energy investment for 2022, the IEA said in a study that $2.4 trillion will be spent in the industry this year, including record expenditure on renewables. However, it acknowledged that this fell short of closing a supply shortfall and addressing climate change.

The investment is up 8% over the previous year, when the pandemic was more severe, and includes significant increases in the electrical sector as well as measures to improve energy efficiency, according to the company’s annual investment report, which was released on Wednesday.

Investment in oil and gas, in addition to delaying attempts to achieve climate objectives, would be insufficient to satisfy growing demand if energy systems were not retooled toward cleaner technologies, according to the report.

“Today’s oil and gas spending is caught between two visions of the future: it is too high for a pathway aligned with limiting global warming to 1.5 degrees C but not enough to satisfy rising demand in a scenario where governments stick with today’s policy settings and fail to deliver on their climate pledges,” the agency said.

Source: Reuters

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