Europe & Russia: Economic overview

Political uncertainty is hitting the economic outlook for the region’s largest markets and limiting the prospects for gas market expansion over the coming months.

Political turmoil in the UK is continuing to hit the value of the pound and the country’s prospects for growth. The pound fell to a 31 year low in mid-January after a period of relative stability in December. Key aspects of what the government wants from the UK’s future relationship with the EU – including its potential departure from the single market – were laid out in a speech by Prime Minister Theresa May on 17 January. However, questions remain about the role Parliament will have in the Brexit process. The country’s GDP is expected to grow by just 1.2% this year. Although the UK’s gas market is still anticipated to grow this year, the weak economic outlook will weigh on the prospects for gas demand growth.