Europe energy: what to look for in 2019

Europe's energy markets sees a series of events come to a head in 2019. Q1 will see top-user Germany develop a position to phase coal out from its power mix to the upside of gas and LNG. Brexit - deal, no deal or no idea? - remains the region's biggest uncertainty; the UK's exit from the EU on 29 March will have wide-ranging impact on cross-border trading of gas, LNG and power. Benefiting from political support, regas FIDs could materialise, mostly FSRUs, but it will be market realities to determine whether they are used. Indigenous supply is on one trajectory in 2019, but with drilling scheduled in the Norwegian Barents Sea and Cypriot East Med, the scene may be set for future rewards. The Ukraine-Russia transit and supply contract will expire 2019-end. A deal may still be brokered but Ukraine transit will fall as Nord Stream 2 and TurkStream come online. Wherever it comes from, Russia's piped gas will be competing with a well-supplied LNG market that will pressure prices in Europe.