Report  |  5 April 2012

It's finally coming: the great European gas market transformation

By Karel Beckman

The European gas market is awaiting radical changes in the years ahead. The old market structure, based on bilateral long-term contracts between a limited number of big suppliers and buyers, will be replaced by (presumably) thriving wholesale markets where sellers and buyers meet on trading hubs to make short-term deals. Some analysts are sceptical. 'Europe is taking a big risk if it relies on this single model', says Dick de Jong of the Clingendael International Energy Programme (CIEP) in the Netherlands. 'We are too much focused on the internal market instead of on the external market on which we increasingly depend.' But Jean-Michel Glachant of the Florence School of Regulation is positive. 'The global gas market is changing fast. Europe has to adapt to the new realities. Otherwise there will be a bloodbath.'

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