Spain reduces its fossil energy bill by 30% but still spends twice as much as in 2019

In the midst of the climate change crisis, the rise of renewable energies around the world and even a ministry focused on the energy transition, Spain has never spent as much on fossil energy as in the last two years under the Government of Pedro Sánchez. The cost of the bill to buy natural gas, oil and derivatives from other countries is being reduced in 2023 (January-October) by a third (-29.3% year-on-year, to 50,126 million euros) compared to the 2022 crisis, but its Import still duplicated to the 2019 design, before the pandemic.

In this way, the trade deficit of the energy balance has been reduced by 35% year-on-year in the first 10 months of 2023, to -28,183 million euros, according to data from January to October in customs from the Ministry of Economy and Commerce that directs Nadia Calvino. The hole last year at this time was -43,907 million and marked a record for the whole of 2022 that exceeded -50,000 million.

The energy balance also includes the import-export balance of ‘coal and electricity’ where an accumulated surplus of 800 million is being produced this year, but it does not compensate for the imbalance generated by buying hydrocarbons abroad. Despite the 90% collapse in natural gas prices from the highs of 2022, the gas bill has only dropped 46% in the comparable period, to 11,662 million, almost double that of 2021 and 2019, or up to three times more . than in 2020.

Algeria, the United States, Russia and Nigeria are the main sources of supply of gas that enters the Spanish network for conventional use for heating or for the electricity generation industry. The four countries account for around 80% of the supply which arrives mostly in the form of liquefied gas (LNG) by ship. Three quarters do so by sea and the rest arrive via the Medgaz gas pipeline that connects Almería with Algeria.

In addition to the drop in prices this year, the sector has helped a drop in consumption that will help reduce by half in 2023 the cost of a hydrocarbon to which Spain allocated a whopping 26,315 million euros in 2022 alone, eight out of ten euros for Algerians, Americans, Russians and Nigerians.

For oil and its derivatives (diesel, cheese, gasoline…), the check was even larger (58,161 million) although exports from the powerful Spanish refining industry also generated more than 29,000 million in exports in those twelve months. On the other hand, gas exports – mainly to Morocco, Portugal and France – barely exceeded 2 billion.

The energy crisis and Spain’s dependence on fossil energy that comes from other countries has left an economy in imbalance in the last two years. The non-energy balance showed a deficit of -6,549.4 million euros in the first ten months of 2023, compared to -16,382 million euros in the same period of 2022, according to data from the Ministry of Economy.

Despite everything, Spain maintained a current account balance of payments surplus of 3% of GDP until October, the best figure since 2018, thanks to the tourism boom. In fact, Spanish exports of services reached 94,915.9 million euros in 2023, which represents an increase of 26.4% compared to the previous year. The trade surplus in services trade stood at 30,898.4 million euros, highlighting business services and transportation

Seg push The Monthly Report of the Ministry of Foreign Trade, Spanish Exports of Goods The Period JANUARY-OCTOBER 2023 Reached S, Stable Compared to 2022. For Their Part, Imports Dropped 6.7%, Up to 354,595 million euros, helping to reduce the hole that this sub-scale also usually registers.