& is that with or without the Russian Energy partnership...

& is that with or without the Russian Energy partnership holdings in others such as HUGE in Iraq & Libya???/
And Hungary got a total energy exemption
https://v4na.com/en/new-sanctions-to-threaten-security-of-european-energy-and-fuel-supplies-hungary-managed-to-win-exemption-108433/

Global energy markets – Reshaped by the war in Ukraine

Europe’s energy crisis is not over yet; fossil fuels should remain expensive in the next few years. Although Europe managed to source LNG from other parts of the world and maintains rather strong inventories (at about 64% as of 21 February) thanks to a milder winter, the energy crisis is not over yet. Assuming a persistent stoppage of Russian gas flows to Europe via the Nord Stream pipeline, with a low probability of some resumed imports in fall 2023 (potentially triggered by peace talks between Ukraine and Russia), available pipeline gas will remain limited. In addition, as about 70% of globally traded LNG is tied to long-term contracts, available volumes might fall short; recent long-term contracts signed with partners such as Qatar and the US will only begin from 2026. Oil supply will also remain constrained, with Russia responding to Western sanctions by reducing crude oil output and OPEC taking a conservative stance in managing production. While gas demand has declined in Europe, lower oil demand due to this year’s global economic slowdown is yet to materialize in consumption data.

Amid this mixed picture, prices for both oil and gas will remain high for the next couple of years (Table 1). We see oil prices averaging 92 USD/bbl in 2023 and 88 USD/bbl in 2024, while TTF natural gas prices would average 75 EUR/MWh in 2023 before consolidating slightly to 60 EUR/MWh in 2024. Prices could rise even further in the event of (i) better economic activity, (ii) further supply cuts from producers or (iii) insufficient gas savings in Europe. On the other hand, (i) a sharper slowdown in economic activity and (ii) a faster energy transition (through greater efficiency or increased electricity availability) could have the opposite effect.

Table 1. Oil and gas price forecast

Sources: Refinitiv, Allianz Research

China and India have replaced the EU as Russia’s top customers for fossil fuels. Western sanctions have had a price impact but have not halted Russian oil and gas exports. According to the latest data, crude oil exports have not decreased significantly in volume terms. However, the war has resulted in two key changes: (i) Russia is selling its oil at a discount – about USD30 less than the Brent officially (the actual discount could be lower) and (ii) its top buyer list looks very different now. In early 2022, the EU was the Russia’s top destination for fossil fuel exports; now it has fallen behind China and India. Both countries are massively importing cheap Russian crude oil for their own consumption or to refine and sell to Europe for top dollar (Figure 1).

Figure 1. Daily Russian oil & gas exports (MT)

Sources: CREA, Allianz Research

Eurozone – energy inflation, quo vadis?

Though inflation has slowed over the last couple of months – largely due to the impact of government support measures aimed at capping energy costs and declining gas/oil prices – price pressures will stay strong during the first half of this year. Last year, the effective embargo on most energy imports from Russia resulted in a surge of electricity and gas prices for most European households. Governments gradually scaled up measures to mitigate the blow by seeking alternative gas supplies, encouraging reductions in energy demand and imposing complete (or partial) price caps. As a result, oil and natural gas prices have come down by about 50% from their mid-year peaks. Given the continued uncertainty about energy supply later in the year when natural gas consumption with pick up again, we expect governments to continue spending further. However, they are likely to tread more carefully as poorly targeted measures could slow down the overall reduction in inflation. Annual inflation still runs above 8% (compared to last year) – that is more than four times the ECB’s price stability target of 2%. With a smaller-than-expected drop of German headline (HICP) inflation from 9.6% in December to 9.2% in January (and less than the fall 8.6% implied by Eurostat’s flash HICP data), Eurozone headline inflation for January has just been revised up from its flash estimate of 8.5% to 8.7% today.

However, energy inflation will drop precipitously during the coming quarters (due to strong disinflationary base effects) and represent less than 10% of overall inflation this year. We expect that inflation will remain unusually high this year, but from Q2 onwards, energy price pressures will shift to price pressures from goods and services (“core inflation”), which have gained momentum over the recent months. For energy (and food) inflation, base effects are becoming increasingly powerful now, especially in countries where the implementation of price breaks occurred only later in the year. Based on our latest energy price forecast (see above), we expect that energy will contribute only 7% to total inflation in the Eurozone this year, down from 49% in 2022 (Figure 2). For instance, in Germany, there will be large impact on energy prices in March and April due to the public sector support for households via make-up compensation for the surge in electricity prices during the second half of last year. Despite declining energy inflation, the negative supply shock to inflation still creates a challenging environment for monetary policy. Since the “divine coincidence” of low inflation during times of slowing growth does not apply, the ECB would need to formulate a forward-guidance on its policy rate path that does not excessively slow aggregate demand (also considering that the economic impact of tighter financing conditions operates with considerable lag) (Figure 3). We expect the ECB to raise the effective policy rate to 3.25% until May and maintain a restrictive stance in 2023 despite stagnating growth.

Figure 2. Eurozone: headline inflation (y/y%) and decomposition (pp)

Sources: Refinitiv Datastream, Allianz Research. Note: estimates based annual logarithmic differences at quarterly frequency for each inflation component (i.e., difference-in-difference approach).

Figure 3. Eurozone: headline inflation vs. output gap trade-off (1984-2027)

Sources: IMF, Refinitiv Datastream, Allianz Research

https://www.allianz.com/en/economic_research/publications/specials_fmo/russia-war-economy.html