Russia's attack on Ukraine has had a strong impact on Europe's energy transition, which is picking up pace as the EU looks for ways to reduce its reliance on Russian gas.
Europe's energy transition will accelerate - with fewer fossil fuels in the energy mix and lower greenhouse gas emissions. By 2024, 34% of Europe's energy mix will come from non-fossil fuels, two percentage points higher than pre-war forecasts, according to a new analysis from DNV's Energy Transition study.
Total natural gas use in 2024 will fall by 9% compared to DNV's pre-war model. The biggest increase is in solar, which will grow by 20% by 2026. The delayed decommissioning of some nuclear power plants on the African continent is also an important part of filling this gap.
The oil and gas industry is at risk of overcapacity by the end of the century as companies look to take advantage of high prices and supply shortfalls. The long-term trend for oil remains bearish, with conflict-related slowing GDP growth and slowing globalization likely to further dampen demand.