On June 15, professionals from the country’s oil and gas industry gathered in the Slovak city of Žilina to take part in a traditional event of the Slovak Gas and Oil Association (SPNZ) – a conference on “Operational Reliability and Security of Main Supply Systems of the Slovak Republic – gas, oil, water”. Experts and managers of the key enterprises in the industry discussed aspects of the current state and prospects of hydrocarbon energy in the Slovak Republic within two days.
A feature of the economic crisis in Slovakia, which is developing against the general background of the global economic recession and the COVID-19 pandemic, is the significant dependence of the small, open Slovak economy (the share of foreign trade in GDP reached 85.7% in 2020) on revenues from export in the field of industrial production, primarily automotive.
The economic losses of the Slovak economy in 2020 amounted to 5.2% of GDP or EUR 4,7 billion, which is fully in line with the basic government scenario of the economic situation forecast of the draft state budget for 2021-2023. According to the results of 2020, the Slovak economy includes: construction (-20%), automotive (-18%) and services (-10%).
With relatively small volumes of natural gas transit at the level of 3.8 billion cubic meters (2020), up to 80% of which is used for domestic consumption and insignificant volumes of own production (31 thousand cubic meters, 2020), Bulgaria continues to implement measures for transit gas infrastructure and underground gas storage, trying to strengthen their role in the regional gas market. To this end, the government is making efforts to diversify transit routes and sources of natural gas supply, increase the liquidity of the Bulgarian gas market, improve the terms of the current long-term contract with PJSC Gazprom.
During 2020 the interest of the world’s leading countries and world energy leaders in the use of hydrogen as an energy source grew notwithstanding the negative impact of the COVID-19 pandemic. The EU, India and Canada have adopted national hydrogen strategies, and such important energy market players as Shell, Saudi Aramco, ExxonMobil have initiated plans to consolidate in a promising global hydrogen market.
Hydrogen has significant potential for energy transfer and storage, but at the same time has significant technological limitations. First of all, hydrogen is seen as a means of overcoming the functional shortcomings of other alternative energy sources, as well as a promising energy resource for a number of countries, such as Japan, where certain decarbonization options have limited use.
According to our experts, a feature of the economic crisis in Slovakia, which is developing against the general background of the global economic recession and the COVID-19 pandemic, is the significant dependence of the small, open Slovak economy on export earnings in industrial production, especially automotive.
According to our experts, the baseline scenario for further development of economic and epidemiological situation in Slovakia assumes that the ongoing second wave of COVID-19 will be longer than that of spring and will last from the end of the third quarter of 2020 till the middle of the second quarter of 2021. Economic losses of the Slovak economy according to the results of this year can range from 8 to 11% of GDP.
The draft state budget of the Slovak Republic for 2021-2023, developed by the Ministry of Finance of the Slovak Republic, was approved at the meeting of the Slovak government on October 14, 2020 and currently undergoes the process of adopting the relevant law in parliament. The document contains elements of economic forecasting and fiscal planning of the state in the context of the economic crisis that is developing in the Slovak Republic against the background of the global economic recession and the COVID-19 virus pandemic.
Immediately after the onset of a strong negative event (whatever the nature of such an event), analysts’ forecasts deteriorate sharply. Usually this deterioration corresponds to the extremely pessimistic scenario. But, fortunately, extremely pessimistic, as well as extremely optimistic scenarios rarely take place in practice. The coronavirus pandemic that broke out in Russia in spring of 2020 was no exception. As the economy adapts to new conditions (and in the course of accumulation of statistics), understanding of the true scale of the problems comes. And now it has become clear that current problems of the Russian economy are serious, but they are not catastrophic.
In the medium term, having achieved a high level of interconnection of the national GTS with neighboring countries and natural gas supply lines, Slovakia can offer gas transportation services in all directions (north-southeast-west) through its territory, while diversifying its sources of origin. Eustream believes that over the next 10 years, natural gas will maintain its important position in the energy balance of the European Union and will support the trend of low-carbon economic development.