Europe and the Challenge of Energy Security: Limitations and Strategies

The increasing dependence of European Union member countries on imported oil and gas has led to concerns about energy supply and security.  At the same time the share of clean energy in Europe’s energy consumption basket is increasing due to environmental issues. About a quarter of all energy consumption in the EU is natural gas, and most EU member states import almost all of their energy resources, especially oil and gas. The increase of European energy imports, including gas from Russia, increases their energy dependence.  We use literature review to study the question of what the most important energy security problems for European countries are and what strategies they can adopt to increase their energy security. The results of this study show that European energy security is compromised by high dependence on oil and gas imports from Russia and inability to source energy from countries like Iran and Venezuela due to sanctions. The most important strategies of countries are to strengthen international institutions such as oil exchanges, use of alternative sources of fossil fuels, diversification of oil and gas import portfolios, joint investment with a basket of oil producers and new pipelines to transport gas. Iran can be a good option for Europe to increase its energy security, given the country’s oil and gas resources and strategic position. JEL Classification: F5, F52  Keywords: Energy security, Europe, diversification, disruption