Germany’s Oil and Gas Production Continues to Drop

German oil and gas production fell again in 2023 compared to 2022, industry association BVEG said on Tuesday, calling for increased domestic production to reduce dependence on more emissions-generating LNG imports.

Last year, Germany’s oil production dropped by 5.9% year-over-year, while natural gas output slumped by 10.4%. 

The share of domestic gas supply of total German supply was 5.7%, while domestic oil production met about 2.2% of Germany’s oil consumption in 2023, figures by BVEG showed.

Germany’s oil and gas production peaked in the 1960s and 1990s, respectively. Output has been falling in recent decades, increasing the share of imports to meet demand.

Germany should maximize domestic oil and gas production, which would be extracted with 30% lower emissions compared to LNG imports, Ludwig Möhring, Managing Director at the BVEG association, said at a press conference. Higher domestic output would also boost the security of supplies and reduce dependence on imports, Möhring added.

The BVEG association groups the companies operating in Germany, including the local affiliates and joint ventures of ExxonMobil, Shell, Neptune Energy, and Wintershall Dea, among others.

Politicians must commit to decarbonization and at the same time to continuous domestic production, Möhring said.

Germany has faced two difficult years scrambling to secure gas supply with energy prices spiking after the Russian invasion of Ukraine and the halt of Russian pipeline gas exports to Germany.  

Last year, Germany imported the equivalent of 968 terawatt hours (TWh) of natural gas in 2023, down by 32.6% from the 1.437 TWh imports in 2022, as consumption also dropped, according to the country’s energy regulator Bundesnetzagentur. Norway was Germany’s top natural gas supplier last year, delivering as much as 43% of the imported gas, followed by the Netherlands with 26% and Belgium with 22%.

Germany’s industry is unlikely to fully recover from the energy price shock and return to the competitiveness from before the Russian invasion of Ukraine, the chief executive of Germany’s top utility, RWE, told the Financial Times last week.

By Tsvetana Paraskova for Oilprice.com

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