Algeria no longer Spain’s main gas supplier

Algeria has lost a major European market as Spain now buys its gas from the US due to a drop in oil and gas prices from OPEC supply lines. The global pandemic has forced many countries to consider cheaper options, telling negatively on Algeria’s three decade supply lines to Europe.

The US and Russia have brought more LNG to Spain through cargo ships than did Algeria through the Medgaz gas infrastructure or the Maghreb pipeline.

Industry sources explain that several operators prefer to break their commitments and look for lower prices in other markets despite having to pay penalties listed in previously signed contracts.

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In the first three months of 2020, Spain received 20,251 Gigawatt hours (DWh) of American LNG compared to 19,748 GWh from Algeria, according to industry reports- a change that might have political implications for relations between Spain and Algeria if it is consolidated over time.

Algeria, a member of the Organization of the Petroleum Exporting Countries (OPEC), depends heavily on oil revenue, with crude oil making up 20% of its GDP and 85% of all exports.

The country, however, is facing fierce competition in the market from major gas producers such as the US, Qatar, and Russia.

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