Thing is that LNG is significantly more expensive and trades on spot markets making prices unpredictable. It’s also not possible to ship LNG in same volumes as pipeline gas. Gas in Europe hasn’t been so much replaced by LNG as the supply having been reduced leading to the recession and deindustrialization we’re now seeing. It’s no longer cost effective to do manufacturing in places like Germany, and industry is now shutting down.
The EU economy prognosis for 2023 is still positive. As far as I am aware only some countries are in a recession, not the EU in total.
And that “industry is shutting down” is also exaggerated.
Pretty much all the major EU economies are in recession, and Germany in particular is doing terribly. If German economy crashes then the rest of EU follows. And no, industry shutting down is not exaggerated. Deindustrialization is now a term that even entered mainstream parlance. It’s simply not possible for EU to be competitive in any sort of manufacturing given the energy prices in Europe.
Germany is in a technical recession, but france, Italy, Spain are not (yet). Don’t get me wrong. I think it is very likely a recession might come, but as far as I can see it is not there yet.
I think this recession will be for Europe only. The US will canibalize part of EU’s industry while the rest moves to Asia. Living standards will never recover. Maybe this even becomes a depression. As you can see Germany’s PMI is fast approaching major recession levels.
