There are several issues here. First, LNG prices are volatile which makes it problematic for the use in the industry. If you’re doing manufacturing, you can’t have your input costs fluctuating all the time. Second, LNG capacity is much lower than pipeline capacity even when accounting for storage. So, overall available energy is lower. Third, there aren’t a lot of LNG terminals available at the moment, so it’s not possible to process LNG quickly if demand rises.
All of these problems make it difficult for industry to operate in Germany, and hence why we’re seeing it moving out of Germany right now. As the industry leaves that means jobs are going to be disappearing leading to higher unemployment, and economic activity will slow down because people are going to be saving money. This is the real concern for Europe and Germany in particular.
There are several issues here. First, LNG prices are volatile which makes it problematic for the use in the industry. If you’re doing manufacturing, you can’t have your input costs fluctuating all the time. Second, LNG capacity is much lower than pipeline capacity even when accounting for storage. So, overall available energy is lower. Third, there aren’t a lot of LNG terminals available at the moment, so it’s not possible to process LNG quickly if demand rises.
All of these problems make it difficult for industry to operate in Germany, and hence why we’re seeing it moving out of Germany right now. As the industry leaves that means jobs are going to be disappearing leading to higher unemployment, and economic activity will slow down because people are going to be saving money. This is the real concern for Europe and Germany in particular.