Surge in Gas Withdrawals from Europe’s Underground Storage Amid Cold Spell
Europe’s energy landscape has been significantly impacted as daily gas withdrawals from underground storage facilities have exceeded 500 million cubic meters (mcm) for the first time this heating season. This spike is largely attributed to a cold snap, driving up energy demand across the continent. According to data from Gas Infrastructure Europe (GIE), the withdrawal rate is nearly 50 times higher than the amount being pumped into storage.
Storage Levels and Market Impact
As of mid-November, European underground gas storage was reported to be 92.1% full, with 102.2 billion cubic meters of gas in reserve. This is a slightly higher than average fill rate for this time of year. Despite this substantial storage, the rise in gas withdrawals has coincided with an increase in gas prices on the European exchange. On November 15, gas prices surged past $500 per 1,000 cubic meters for the first time since November 2023, reflecting the heightened demand and ongoing supply concerns.
The price surge follows recent developments involving Austrian energy company OMV, which reported receiving an arbitral award in a dispute with Gazprom Export. This ruling, which entitles OMV to recover damages of €230 million due to Gazprom’s failure to meet its contracted supply volumes, has raised concerns about the stability of future gas supplies to Europe. These issues have contributed to the volatility in the gas markets, which are already dealing with the broader geopolitical tensions resulting from the ongoing Russia-Ukraine conflict.
Gazprom and European Gas Supply
Despite these challenges, Russian energy giant Gazprom continues to supply gas to Europe, mainly via Ukraine. As of November 15, Gazprom was pumping 42.4 million cubic meters of gas per day through the Sudzha gas station in Russia’s Kursk region. This consistent supply is crucial for European countries that rely on Russian energy, even as tensions surrounding the war in Ukraine persist. However, Gazprom’s request for additional supplies through the Sokhranovka gas station has been rejected by Ukrainian authorities, adding further complexity to the situation.
LNG and Long-Term Supply Dynamics
Liquefied natural gas (LNG) imports have also played a critical role in Europe’s energy supply this year. In August, LNG supplies to European terminals reached their lowest point since October 2021. However, there has been a rebound in the fall, with LNG imports climbing to 8.8 billion cubic meters in October—an 11% increase over September. Still, this level remains the lowest for an October since 2021, and regasification facilities are operating at just 45% of their capacity.
Conclusion: Rising Pressures on European Energy Security
The increasing demand for gas amid a cold spell, combined with the volatility in global gas markets, underscores the ongoing challenges facing Europe’s energy security. While storage facilities remain relatively well-stocked, price fluctuations and supply disruptions—exacerbated by geopolitical tensions—are likely to continue shaping the region’s energy landscape throughout the winter. The situation also highlights Europe’s growing reliance on both Russian gas supplies and LNG imports, a dynamic that is closely watched by policymakers and energy analysts alike as they seek to balance energy security with the transition to greener energy sources.
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