August 04, 2022 [Reuters] – European countries are on track to reach a gas storage filling target by the start of this winter, but the cost of replenishing stocks will be over 50 billion euros ($51 billion), 10 times more than the historical average of filling up tanks for winter.
Reuters Graphics
“The EU already surpassed its September 1 interim filling target in early July and is still on pace to reach the November 1 target,” said Jacob Mandel, senior associate for commodities at Aurora Energy Research.
European governments had been concerned that Russia’s cut in supplies through its main gas pipeline to Germany would leave countries unable to meet goals to refill storage for winter.
They have managed to build up gas storage steadily by curbing demand, switching from gas to coal for some power plants and increasing imports of liquefied natural gas (LNG).
European gas storage levels were 70.54% full on Tuesday, surpassing the 5-year average of 70.32%, according to data from Gas Infrastructure Europe (GIE) released on Thursday. The levels were also not far from a 10-year average of around 71.40%.
European countries are on track to reach a gas storage filling target by the start of this winter, but the cost of replenishing stocks will be over 50 billion euros ($51 billion), 10 times more than the historical average of filling up tanks for winter.
European governments had been concerned that Russia’s cut in supplies through its main gas pipeline to Germany would leave countries unable to meet goals to refill storage for winter.
They have managed to build up gas storage steadily by curbing demand, switching from gas to coal for some power plants and increasing imports of liquefied natural gas (LNG).
European gas storage levels were 70.54% full on Tuesday, surpassing the 5-year average of 70.32%, according to data from Gas Infrastructure Europe (GIE) released on Thursday. The levels were also not far from a 10-year average of around 71.40%.
The European Union aims to refill storage to 80% of capacity by Nov. 1 to provide a buffer for peak demand winter months. The EU has also set interim targets for each country for each month.
Germany, hardest-hit by Russia’s reduced gas flows, has set a higher goal for itself and aims to be 95% full by November.
Summary
Europe gas storage 70% full, surpassing 5-year average
Filling EU tanks to targets costs 50-55 bln euros-analysts
Europe raised LNG imports to compensate for reduced Russia flows
Despite building up gas storage, uncertainties remain
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