Brent crude tops $90 after gas producer says it will take ‘weeks to months’ to restore deliveries

Qatar’s energy minister has warned that war in the Middle East could “bring down the economies of the world”, predicting that all Gulf energy exporters would shut down production within days and drive oil to $150 a barrel. Saad al-Kaabi told the FT that even if the war ended immediately it would take Qatar “weeks to months” to return to a normal cycle of deliveries following an Iranian drone strike at its largest liquefied natural gas plant. Qatar, the world’s second-largest producer of LNG, was forced to declare force majeure this week after the strike at its Ras Laffan plant. While Qatar only exports a small proportion of its gas to Europe, the energy minister said the continent would feel significant pain as Asian buyers outbid Europeans for whatever gas is available on the market, and as other Gulf countries find themselves unable to meet their contractual obligations. “Everybody that has not called for force majeure we expect will do so in the next few days that this continues. All exporters in the Gulf region will have to call force majeure,” Kaabi said. “If they don’t, they are at some point going to pay the liability for that legally, and that’s their choice.” Kaabi’s comments reflect rising concern in the Gulf about the economic repercussions of the US and Israel’s war with Iran, which has wreaked havoc across the oil-rich region. Brent crude rose 5.5 per cent to $90.13 a barrel on Friday following the publication of this article, the highest level since the start of the conflict. European gas prices gained 5 per cent, but were still below this week’s peak. “This will bring down the economies of the world,” Kaabi said. “If this war continues for a few weeks, GDP growth around the world will be impacted. Everybody’s energy price is going to go higher. There will be shortages of some products and there will be a chain reaction of factories that cannot supply.” He said while there had been no damage to Qatar’s offshore operations, the aftermath onshore was still being reviewed. “We don’t yet know the extent of the damage, as it is currently still being assessed. It is not clear yet how long it will take to repair,” he said.

Qatar’s $30bn development to increase production capacity at its vast North Field gasfield from 77mn to 126mn tonnes a year by 2027 would also be delayed, he added. The first production was to begin in the third quarter of this year. “It will delay all our expansion plans for sure,” Kaabi said. “If we come back in a week, perhaps the effect is minimal; if it’s a month or two, it is different.” Saudi Arabia and the UAE both have pipelines that can redirect a portion of their oil exports to be loaded at ports outside the Strait, but significant production volumes remain trapped.  He forecast that crude prices could soar to $150 a barrel in two to three weeks if tankers and other merchant vessels were unable to pass through the Strait of Hormuz, a key maritime trade route through which a fifth of the world’s oil and gas passes. He predicted that gas prices would rise to $40 per million British thermal units (€117 per MWh) — almost four times the level they were before the war began. He added that the impact of the disruption of maritime trade through the strait would reverberate far beyond energy markets and hit multiple industries as the region produces much of the world’s petrochemicals and fertiliser feedstocks. Traffic through the waterway has slowed to a halt since the US and Israel launched their attack on Iran on Saturday. At least 10 ships have been hit, insurance premiums have soared and shipping owners have been unwilling to risk their vessels and crews. US President Donald Trump and Israeli officials have warned that the war could last weeks as they seek to destroy the Islamic regime. Trump said this week that the US navy will escort ships through the strait and has offered to provide additional insurance to shipping companies. But Kaabi said it would still be unsafe for vessels to pass through the strait, which is just 24 miles wide at its narrowest point and traces the Iranian coastline, as long as the war was ongoing. “The way that we are seeing the attacks, bringing ships into the strait . . . it’s too dangerous. It’s too close to the shore to bring ships in. It will be difficult to convince ships to go in,” he said. “Most of the ship owners will see that they become a bigger target because they’re [Iran] targeting the military ships.” Kaabi added: “In addition to energy, there will be a halt on all other trade in between the [Gulf] and the world, which will have a significant effect on the economies of the [Gulf] and all the trading partners around the world.” Qatar, which hosts the biggest American military base in the region, has traditionally had good relations with Iran. But the Islamic republic has fired multiple barrages of missiles and drones at it and other Gulf states as Tehran sought to raise the stakes for the US by targeting energy facilities, airports, American bases and embassies.

Kaabi, who is also chief executive of QatarEnergy, said the company had no choice but to declare force majeure after Ras Laffan was hit in an Iranian drone attack on Monday. He cited safety reasons, adding that the company’s offshore facilities were also facing the threat of attack, although they were not damaged. “We were actually informed by our military that there is an imminent threat on the facilities offshore. So we shut down operations safely, as safely as we can, and we mobilised around 9,000 people in 24 hours and brought them back,” he said. “When we have our people in danger and we’re actually being hit in a military zone and we can’t work anymore, and we can’t put our people in harm’s way, we have to declare force majeure.” Production in Qatar will not restart until there is a complete cessation of hostilities, he said. “So the signal is when our military says there is a complete stop of hostilities and we are not being attacked anymore,” Kaabi said. “We are not going to put our people in harm’s way.”

After the restart, he predicted huge logistical issues on top of the restoration of the machinery that cools and compresses gas into liquid that can be shipped. “Our ships are all over the place,” he said, adding that only six or seven out of Qatar’s fleet of 128 tankers were at hand. “Each ship takes a day or two and you can load six or seven at a time,” he added, explaining the length of time it would take to restore normality. He rejected the idea that Qatar’s decision to invoke force majeure and miss shipments would damage the country’s long-cherished reputation as the most reliable supplier of LNG. “We don’t think anybody would dare to come to us and say we are not reliable because you were being bombed and you did not deliver,” he said. Even if it wanted to, Qatar was unable to find gas in the market to make good the lost deliveries to its clients, he said. “Let’s assume you want to buy 77 million and deliver it to customers, there is no 77 million tonnes lying around for you to buy.”

https://www.ft.com/content/be122b17-e667-478d-be19-89d605e978ea

إيمان شويخ

بدأت تداعيات الحرب الدائرة في المنطقة تضرب أسواق الطاقة العالمية. فالمواجهة العسكرية التي بدأت في إيران ونُقلت سريعًا إلى الخليج تؤثر بشكل سلبي كبير على الاقتصاد العالمي، مع انتقال الاستهدافات إلى منشآت الطاقة وممرات الملاحة، في مشهد يربك الأسواق ويرفع منسوب القلق حيال إمدادات الطاقة والغاز، ما ينذر بحرب طاقة تضرب الممرات البحرية وخطوط الإمداد.

في حديثٍ لموقع الكلمة أونلاين، اعتبر خبير النفط د. رودي بارودي أن الحرب الراهنة وحالة الاضطراب بين إيران وجيرانها الدول الخليجية، العراق والكويت والمملكة العربية السعودية وقطر والإمارات العربية المتحدة وسلطنة عمان، حتمًا ستؤثر على أسعار الطاقة العالمية، بالنسبة للنفط الخام أو الغاز الطبيعي المسال (LNG).

وفي حال بقي مضيق هرمز مغلقًا، فإن منتجي الـ (LNG) وهم قلة وعلى رأسهم دولة قطر وأستراليا والولايات المتحدة الأمريكية وروسيا وماليزيا والجزائر، فإن الأسعار سترتفع حوالي 50%. وفي حال بقي المضيق على حاله ولم تتمكن الناقلات من المرور، فإن هذا الارتفاع مرجح للتصاعد.

أما بالنسبة للنفط، يقول بارودي إنه هناك 20 مليون برميل في اليوم تمر من مضيق هرمز، وبالتالي من أجل تعويض هذه الكمية يجب الذهاب إلى الولايات المتحدة وروسيا وكندا والصين، إضافةً إلى البرازيل، لأن المملكة العربية السعودية لن تعد قادرة على أن تمد من مضيق هرمز خلال العراق. أما السعودية، فتمتلك خط أنابيب شرق-غرب 1 وخط أنابيب شرق-غرب 2، الذي يمر من المنطقة الشرقية في المملكة، وهي تستطيع نقل 7 براميل نفط يوميًا، ولكن مع ذلك فهذا لا يكفي للتعويض عن النقص في النفط، بل يجب البحث عن بدائل أخرى.

وعن أسعار النفط، أشار الخبير النفطي رودي بارودي إلى أنها قفزت من 70 إلى 85 دولارًا للبرميل، وهي قفزة كبيرة جدًا. وإذا بقي مضيق هرمز مقفلاً، فهي سترتفع إلى 100 دولار للبرميل الواحد، وهذا يعني أن أسواق الطاقة العالمية ستتعرض لارتفاعات جنونية في الأسعار.

وبالنسبة للبنان، اعتبر بارودي أن صفيحة البنزين أساسًا قد ارتفعت 20 دولارًا، وهي حتمًا سترتفع إلى 25 دولارًا للصفيحة الواحدة متأثرةً بأسعار النفط العالمية. كذلك فإن أسعار النقل والسلع الغذائية والخضروات والكهرباء و غيرها، بالإضافة إلى كلفة بطاقات السفر، ستقفز بشكل جنوني.

وفي حال ارتفعت هذه الأسعار بالوتيرة التي ترتفع بها الأسعار في العالم، وبقيت المداخيل على حالها، فإن هذا الأمر سيؤدي إلى كارثة اقتصادية في لبنان تضاف إلى الأزمة الاقتصادية التي يعيشها لبنان منذ سنوات.

The past few days have served up multiple reminders of why armed conflict is almost never a good option, let alone the best one: war is dangerous, expensive, and unpredictable, making it the last resort for prudent leaders.

The entire region is on edge, with Iran seeking to internationalize the conflict so that other states will put pressure on the United States and Israel to halt their air and missile offensive. We are now on the precipice, however, of developments whose impacts will effect virtually everyone, everywhere.

I refer, or course, to the Strait of Hormuz, the narrow, shallow, and uniquely vital waterway that connects the Gulf to the open seas and haunts the dreams of risk analysts everywhere.

About a fifth of the world’s oil – worth more than half a trillion dollars annually – transits this passage, and while Saudi Arabia and the United Arab Emirates have pipelines that avoid the strait, they can’t handle nearly the same volumes. In addition, approximately the same share of the world’s liquefied natural gas passes through the same corridor, most of it Qatari LNG outbound for Asia. For good measure, Hormuz is also the route by which some 200 million people, including most of the six-nation Gulf Cooperation Council (GCC), receive most of their food and other imports.

For decades, the Iranian government has claimed the right, boasted the ability, and vowed the willingness to close this waterway in response to various forms of military or other pressure from the US. Then as now, its reasoning has been both subtle and brutal.

Outwardly, Iranian officials have denied targeting GCC and other states with missiles and drones, insisting that their forces were aiming instead at US military assets on their soil, even though most of these countries have not allowed their airspace to be used for the US/Israeli offensive. Even if it were true, the Iranian interpretation would certainly be a distinction without a difference for those mourning lost loved ones, but there have now been countless attacks drone and missile attacks on homes and residential buildings, port facilities, oil and gas infrastructure and other civilian targets in several GCC countries. Either way, the Iranians seem to have calculated that inflicting some degree of pain on their neighbors will cause more voices – in this case from within US-allied countries – to demand an end to the war.

A similar arithmetic makes Hormuz the world’s ultimate choke point. The mere possibility of lasting disruption there has caused energy prices to rise on countless occasions, including the current crisis, and an actual closure for any length of time would be highly corrosive to the global economy. And since energy prices get baked into virtually everything else, the pain would be felt virtually everywhere.

The number of countries that Iran can hit with missiles or drones is relatively limited. But close Hormuz and no country on earth would be immune to the consequences, causing many of them to demand a return to diplomacy.

The fact of the matter is that Iran administers only a small section of the strait, specifically a strip of the northern channel usually used for entering the Gulf, and international law gives it no legal authority to suspend shipping there for more than a few hours without compelling reasons. Article 44 of the 1982 Law of the Sea specifically mentions that innocent passage cannot be denied. This is one reason why Tehran has been so cagey about its intent, for instance by having its parliament pass and illegal legislation supposedly authorizing closure, but then leaving the activation to the executive branch.

In legal terms, then, it is difficult to conceive of circumstances in which Iran could justify closing the strait and imposing so much hardship on so many people around the world. Whatever its stated intentions, its actions would amount to little more than sabotage and extortion.

In reality, Iran is already getting some of what it wants. Information published by Navionics and other ship tracking services indicates that until the current interruption, increasing numbers of ships were avoiding Iranian waters altogether, sailing entirely or almost entirely in Omani waters. But several ships have already been damaged, putting instant upward pressure on insurance rates and convincing most shipping companies that the risk is too great. Dozens of hulls – carrying oil, LNG, and all manner of general cargo – are now waiting to leave the Gulf, and dozens more are piling up outside it. Prices are already starting to rise, and each day that passes makes energy scarcer and more expensive.

It won’t take long for the consequences of this kind of disruption to grow in size and severity. Traders and speculators may be able to stave off the full impact for a few days, and other oil producers can pump more to compensate, but eventually most of the GCC states will run out of storage and have to halt production. The situation for LNG could be even worse because there are so few producers, and Qatar has already halted production over safety concerns, idling almost a fifth of global output.

For all of these reasons, this war involves far more than the official belligerents. The region’s geography and geology mean that anyone who uses energy in any way has a direct stake in the outcome. Even countries that export oil and gas have a vested interest in a return to stability: rising prices might be tempting in the short term, but they inevitably damage economies and weaken demand over time. For this reason in particular, all responsible participants, willing or otherwise, need to be pushing for a negotiated solution.

Dialogue and diplomacy are never wasted efforts. Even when they fail to prevent or end a conflict, discussions carried out in good faith can leave behind the building blocks for a future understanding. The mere fact of direct or indirect contacts can also attenuate the intensity of operations – therefore limiting potential casualties and renewed impetus for more war – as planners start considering the repercussions for diplomacy.

As human beings, therefore, we should never give up on the possibility of peace. But nor can we sit and say nothing as Iran lashes out at peoples and countries who have nothing to do with this conflict, destabilizing the entire region and undermining standards of living the world over. This is especially true of Qatar and Oman, both of which have left no stone unturned in trying to keep Iran out of a war in the first place.

Roudi Baroudi is the author of several books about maritime boundaries and has worked in the international energy business since the 1970s. He currently serves as CEO of Energy and Environment Holding, an independent consultancy based in Doha.

March 2, 2026, DOHA, Qatar: In a televised interview with Al Jazeera’s main Arabic channel, international energy expert Roudi Baroudi said that no country had the right to close the Strait of Hormuz.

The United Nations Convention on the Law of the Sea (UNCLOS), Baroudi told Al Jazeera, is clear on this matter, specifically Article 38, which explicitly guarantees the “right of transit passage, which shall not be impeded” for all foreign vessels transiting through the strait, and Article 44, which holds that states bordering straits “shall not hamper transit passage”.

Baroudi also warned that if traffic through Hormuz were halted, oil prices would quickly soar past $100 – and even $150 if the interruption persisted for any length of time.

While the strait is commonly described as being 30-45 kilometers wide, he explained, most of it is too shallow for large vessels, and the transit lane – designated for the passage of all types of shipping, from oil tankers and LNG tankers to container ships and bulk food and other commercial cargos – is only 3 kilometers wide. Even here the depth is just 200-300 meters, and many of the oil tankers that use the strait are more than 325 meters long, and Qatar’s Q-Max LNG carriers are 345 meters.

Baroudi also noted that while Iran and Oman have had a maritime border agreement in place since 1974, only Oman has fully ratified UNCLOS. Iran – like the UAE, whose coast also touches the strait – has signed but not fully implemented all of the provisions. Nonetheless, he said, UNCLOS’ principles have become part of customary international law, making them enforceable on all coastal states, so all civilian vessels enjoy the right of passage without obstruction, inspection, or arbitrary restrictions.

Regarding the impact of current tensions, Baroudi noted that LNG prices were already rising and that $100 or even $150 oil was a distinct possibility if the conflict continued beyond a week or two. Any prolongation of exorbitant energy costs, he added, would have a direct and deleterious impact on the global economy, increasing inflationary pressures and the cost of living worldwide.

Following criticism of the Lebanon-Cyprus Maritime Boundary Agreement (MBA) by the governments of Israel and Turkiye, LebTalks spoke with energy and policy expert Roudi Baroudi, who has authored several books and studies on sea borders in the Eastern Mediterranean. Baroudi praised the pact as “full of positives” for the interests of both parties and stressed the words of Lebanese President Joseph Aoun, who pledged after signing the MBA that “this agreement targets no one and excludes no one.”

LebTalks: How significant is the signing of the maritime boundary agreement between Lebanon and Cyprus?

RB: The official signing of the Lebanon-Cyprus deal is a major achievement, one that confers important advantages on both parties. This process was delayed for a very long time for no good reason, so President Joseph Aoun and the government deserve congratulations for having seized the initiative, and for having seen the job through to completion. So do Cypriot President Nikos Christodoulides and his team, because they did the same thing. What made this historic agreement possible – after an impasse lasting almost two decades – was that Lebanon finally had a president who both understood the need for an MBA and made achieving it a top priority.

LebTalks: What does Lebanon gain by signing this deal?

RB: The agreement, which was reached by the negotiating teams in September, provides several benefits for both countries in the short, medium, and long terms.

The new equidistance line between the two states, defined according to the rules and guidelines of the United Nations Convention on the Law of the Sea (UNCLOS), provides a fair and largely uniform boundary between the two brotherly countries’ maritime zones. Most of the new turning points used to draw the line have moved in Lebanon’s favor compared to the earlier negotiation in 2011, giving it an extra 10,200 meters on its western front while Cyprus received 2,760 meters.

Crucially, the MBA wipes away all overlapping claims caused by previous uncertainty over the precise location of the border. Accordingly, this eliminates 108 km2 of (map attached) Lebanese offshore blocks that were actually in Cypriot waters, as well as 14 km2 of Cypriot blocks which were also on the wrong side of the line.

Apart from removing a key risk for would-be investors, the agreement also contributes to stability and security by providing clarity and thereby enabling easier cooperation, not just bilateral, but also, potentially, involving other states as well. It really is full of positives for both Lebanon and Cyprus, and therefore for the region as a whole.

LebTalks: What should Lebanon do to follow up on this agreement?

RB: To make the most of this clearer playing field, the logical next step is for Lebanon and Cyprus to immediately start drafting a joint development agreement, which would allow them to have a smooth partnership in place for any hydrocarbon reserves which are found to straddle their maritime boundary.

Perhaps the most important feature of the Lebanon-Cyprus MBA is that it provides a clear and stable starting point, putting Lebanon in ideal position to finish defining its maritime zones. The new line means that Lebanon’s existing maritime boundary arrangements with Israel, signed in 2022, should be tweaked a little, but it also makes it easier to do that – and to negotiate a similar agreement in the north with Syria when that country’s new leadership is ready to do so.

LebTalks: What about the objections voiced by Irael and Turkiye?

RB: With all due respect, these claims and complaints are completely baseless. As President Aoun has stressed from the very day it was signed, this accord targets no one, excludes no one, challenges no one else’s borders, and undermines no one else’s interests. I know there has been some negative commentary from both Israel and Turkiye, but there really is nothing here for anyone to be upset about. The line agreed to by Lebanon and Cyprus, which Turkiye has claimed is ‘unfair’ to residents of the self-styled ‘Turkish Republic of Northern Cyprus’, is literally several kilometers away from any waters claimed by the TRNC. Beirut and Nicosia were very careful to make sure of this.

As for the Israelis, the only material change relating to the Lebanon-Cyprus line is that it pushes the Israel-Cyprus line in Cyprus’ favor. But that’s not Lebanon’s fault. Or Cyprus’ or anyone else’s. It’s just a fact of new mapping technologies, which today are far more precise and more accurate than those used when the Israel-Cyprus line was drawn in their 2011 treaty.

On that subject, I would also note for all stakeholders in the East Med that while Lebanon and Cyprus are the region’s only full-fledged members of UNCLOS, all states are subject to its rules and precedents, which have become part of Customary International Law. Since the Lebanon-Cyprus deal adheres strictly to those rules and the science behind them, the criticisms haven’t got a legal leg to stand on. This is especially true with regard to Israel, whose own treaty with Cyprus was negotiated on the basis of the very same laws, rules, and science.

I have to assume that a lot of this is posturing, that both Israel and Turkiye will settle down once they’ve had more time to analyze the deal and see that, far from damaging them in any way, it could help all concerned by contributing to regional stability and economic growth. And again, I would go back to Aoun’s words on signing day, when he declared that “this agreement should be a foundation for wider regional cooperation, replacing the language of violence, war, and ambitions of domination with stability and prosperity.”

كَثُرَت في الفترة الأخيرة الخيارات المتاحة في نظر بعض المسؤولين في لبنان، لتأمين مصادر يتم عبرها تسديد أموال المودِعين… فما أن طُرِح إنشاء الصندوق السيادي، حتى ارتأى البعض اللجوء إلى رهن جزء من احتياطي الذهب… لكن ما لم يكن في الحسبان أن يقترح أحدهم استخدام أموال ثروة لبنان النفطية لتسديد الودائع ولتغطية كلفة الدين العام! علماً أن مفاوضات ترسيم الحدود البحرية بين لبنان وإسرائيل عالقة منذ أيار 2021، ولا تزال الضبابية تلف هذا الملف محلياً ودولياً.

الخبير الدولي في مجال الطاقة رودي بارودي يعلّق, في حديث إلى موقع القوات اللبنانية الإلكتروني، على الفائدة المالية من حقول النفط التي يؤمَل أن تشكّل الثروة النفطية للبنان، ليؤكد أنه “في حال حصول لبنان على جزء من حقل كاريش, فإن حصته لا تكفي لتغطية الدين العام اللبناني حتى وفق أسعار النفط والغاز المعتمدة حالياً”، ويقول “ربما قد تغطي حصّة لبنان من حقل كاريش أو غيره، جزءاً ضئيلاً فقط من الدين العام”.

ويعتبر أنه “من غير المؤكد ما إذا كان لبنان سيتمكّن من الحصول على الخط 23، من دون معالجة مجموعة من الأخطاء الجسيمة التي ارتُكِبَت عند البدء بوضع الخطوط من 1 الى 23 قبل نحو 12 عاماً”.

ويكشف بارودي عن أن حقل “كاريش” المكتشَف العام 2013 يحتوي على 2.5 ترليون قدم مربّع من الغاز. وهذا الحقل تم اكتشافه من قبل الشركة الإسرائيلية “ديليك” العام 2013 والتي باعته بدورها إلى “إينيرجيان”.

ويقول، إذا تم احتساب الكمية على أساس أسعار الغاز والنفط الحالية، فإن المردود المتوقع من حقل “كاريش” يتراوح ما بين 22 و25 مليار دولار أميركي. لكن لا يمكن تقدير مردود حقل “قانا” لأنه قد يكون ممتداً إلى إسرائيل، كما أن حقل “كاريش” متداخل بين لبنان وإسرائيل.

ويُلفت إلى أن إسرائيل أنجزت التحضيرات اللازمة لبدء الإنتاج النفطي وذلك بعد أعوام عدة من الدراسات وعمليات الاستكشاف، فقد عاودت شركة “إينيرجيان” المطوِّرة لحقل “كاريش” الحَفر في الحقل ذاته بحثاً عن المزيد من الغاز والنفط، ويوضح أن “إسرائيل تقوم حالياً بالحَفر في محاذاة الخطّ اللبناني التفاوضي “29” لتنتقل بعد ذلك إلى شمال “كاريش”.

ويُذكِّر في السياق بأن “لبنان أعلن في رسالَتَيه إلى الأمم المتّحدة الأولى في 22 أيلول 2021 والثانية في 28 كانون الثاني 2022، أن حقل كاريش يقع في منطقة متنازع عليها… لكن على الرغم من ذلك، يتم التنقيب في المياه المتنازَع عليها عموماً، ولا سيما في البلوك رقم “9” المُعطّل حالياً إلى أن تُحّل قضية الترسيم بين لبنان وإسرائيل”.

أما بالنسبة إلى الموقع الجغرافي لحقل “كاريش” المكوَّن من جزءين: شمالي وجنوبي (الخريطة مرفقة)، يؤكد بارودي من خلال الدراسة التي أعدّها خلال السنوات الممتدة من العام 2011 إلى العام 2021، أن “حقل كاريش الشمالي يَبعد عن الخط المقترح من قبل لبنان في 14 تموز 2010 (الخط 23) حوالي 7 كلم و116 متراً، كما أن حقل كاريش الجنوبي يَبعد عن الخط نفسه، حوالي 11 كلم و170 متراً جنوباً، وذلك بحسب الخريطة المرفقة والتي تؤكد المواقع والبُعد عن الحَقلين”.

أما بالنسبة إلى البلوك الإسرائيلي الرقم “72” والمتداخل في الأراضي اللبنانية، فهو ملاصق بشكل مباشر للخط “23”، بحسب بارودي.​

Bloomberg

Sweden, known for its long dark winters with barely any daylight, is seeing a solar power boom.
Harnessing whatever sunshine the country gets is emerging as the quickest solution to fill part of the void left by two closed nuclear reactors in southern Sweden, where the biggest cities and industries are located. With shortages piling up in the region and consumers keen to secure green energy at stable prices, solar is quickly catching up with wind as developers put panels on rooftops and underutilised land in populated areas.
While the lack of sunlight is a hindrance, every bit of new electricity capacity will lower imports from Europe where prices are more than three times higher than in the rest of Sweden. Projects are also getting built quickly because developers are directly getting into power sales deals with consumers and aren’t dependent on government support, said Harald Overholm, CEO of Alight AB, which started Sweden’s biggest solar plant this month.
Companies are targeting a quick ramp-up, pushing total capacity in the country to 2 gigawatt this year. That’s more than the two nuclear reactors in Ringhals that were halted in 2020, and will close the gap with Denmark, an early mover in the industry in the region.
“We are very good at creating contracts directly with commercial partners that use power, and that is what drives our development,” said Harald Overholm, CEO of Alight.
The past winter has demonstrated the hole left behind by the two atomic reactors, with the government facing the task of resolving a divergent market. While vast hydro and wind projects have kept the cost of electricity in the sparsely populated north in check, a lack of generating capacity and congested grids have forced the south at times to import power.

European Central Bank chief Christine Lagarde warned yesterday that the pandemic still poses “serious risks” to the eurozone economy as concerns grow about new virus variants and sluggish vaccination campaigns.
The Frankfurt institution’s governing council held back from tweaking its ultra-loose monetary policy at its first meeting of the year, having already topped up up support in December.
Lagarde stressed that “ample monetary stimulus” remained essential to steer the 19-nation currency club through the Covid-19 upheaval, and that the ECB stood ready to do more as needed.
“The pandemic continues to pose serious risks to public health and to the euro area and global economies,” Lagarde told an online press conference.
The start of mass vaccination drives in the European Union was “an important milestone”, she said, but the rollout has got off to a bumpy start in many nations.
The emergence of more contagious virus variants, first discovered in Britain and South Africa, has added to nervousness at a time when many countries are already struggling to bring down infection numbers.
Europe’s top economy Germany this week extended its partial lockdown until February 14, and Chancellor Angela Merkel has not ruled out border checks to slow the spread of the new strains.
France and Spain have tightened their evening curfews, while non-essential shops and leisure facilities are closed across much of the continent.
The latest virus setbacks “are disrupting economic activity,” Lagarde said, noting that the services sector was hit especially hard.
“The intensification of pandemic poses some downside risks to the short-term economic outlook,” she added.
The ECB in December forecast 3.9% growth for 2021, after an estimated contraction of 7.3% in 2020.
Lagarde said the ECB’s forecasts “remain valid” for now, as they took into account lockdowns persisting through the first quarter coupled with a gradual start to vaccinations.
The former French finance minister also reiterated her plea for European governments to support the ECB’s efforts through fiscal policy.
She urged European Union members to speed up the ratification of a recently agreed €750bn recovery fund, saying it had a “key role” to play in financing the region’s bounce-back.
Under Lagarde, the ECB took unprecedented steps last year to cushion the impact of Covid-19 on the euro economy.
Its biggest weapon is a pandemic emergency bond-buying scheme, known as PEPP, that was in December topped up by €500bn to reach a total envelope of €1.85tn.
The scheme was also extended to March 2022.
The bank has also offered ultra-cheap bank loans and held interest rates at historic lows.
The goal of the measures is to keep borrowing costs low to encourage spending and investment in the 19-nation currency club, in a bid to boost growth and inflation.
But eurozone inflation has stayed stubbornly low for years and even turned negative in 2020.
By the ECB’s own estimates, price growth will gradually inch up to 1.4% by 2023, still far off the bank’s target of just under 2%.
In December, inflation stood at minus 0.3%.
Analysts say inflation could bound higher later this year, powered by pent-up consumer demand once lockdowns start easing.
But any boost is expected to be short-lived, they caution.
Lagarde agreed that inflation was “likely to increase in the coming months”, partly also due to the end of a temporary sales tax cut in Germany from January.
But she said “underlying price pressures are expected to remain subdued due to low demand in tourism and travel sectors, and the appreciation of the euro against the dollar.”
The euro has risen by more than 10% against the greenback since late February, complicating ECB efforts to push up inflation.
A stronger euro makes imports cheaper, keeping a lid on consumer prices, while exports become less competitive, hurting growth prospects.
Lagarde said the governing council was monitoring exchange rates “very carefully”. For now, the ECB “remains happy at the sidelines and has kept all options open,” said ING bank economist Carsten Brzeski.
“In the absence of any severe economic accident, the ECB is likely to stick to this line at least until late summer,” he added.