Shell warns Europe may face energy rationing in ‘really tough winter'

European consumers should expect energy rationing next winter amid persisting rise in costs and the potential cut-off of Russian gas supplies, chief executive of UK-based energy giant Shell has warned.

“We will all face very significant escalation in energy prices. In the worst case, Europe will need to ration its energy consumption,” said Ben Van Beurden in an address before the Aurora spring conference in Oxford, warning, “It will be a really tough winter in Europe.”

“So there will be a lot of pressure on industry and therefore there will be a lot of pressure on the economy,” he further emphasized. “In the worst case, we will be in a situation where we have to ration.”

Russian President Vladimir “Putin has surprised quite a few of us,” the Shell chief said. “I feel disappointed by the outcomes. He has also shown that he better be taken seriously when he makes threats … For a long time we thought it was not in Russia’s interest to cut off Russia’s largest market.”

Van Beurden said the Russian president was “able and willing to weaponize supplies,” insisting that there was “no way of telling” whether Moscow would resume gas flows into Europe via the Nord Stream 1 pipeline after maintenance began last Monday and due to conclude on July 21.

His alarming remarks came as retail energy suppliers called on the British government to intervene again to keep UK bills in check, following a £15 billion package of measures announced in May to ease the cost of living crisis, which includes £400 off energy bills for every household.

Prices, meanwhile, are forecast to continue soaring into the fall, as British authorities expressed uncertainty over the extent to which Russia will continue to limit supply.

The Shell boss also commented on the energy profits levy on North Sea oil and gas operators, adding, “I would have liked to have seen incentives and allowances for those companies that actually invest in energy transition.”

ME