empty
05.01.2022 11:25 PM
Europe runs the risk of being left without gas in March

This image is no longer relevant

Gas reserves in the European Union are currently at an all-time low. According to the global energy research group Wood Mackenzie, the level of gas reserves in European storage facilities is at risk of falling to a historic low this spring. In other words, in the next two months, in the event of record frosts, European countries are likely to remain without gas.

The cost of February gas futures on the ICE Futures platform slightly rose, namely by 3.4%, to $1,072 per 1 thousand cubic meters.

Europe is currently in the stage of energy transition, when coal-fired power plants are being actively closed. However, the climate agenda and the pursuit of environmental friendliness increases the dependence of the euro region on renewable energy sources, which this region cannot satisfy in sufficient amounts of energy, especially on a permanent basis. For example, last year, the desire of European countries to follow the climate agenda and receive energy from wind and solar resulted in a sharp decline in electricity generation and further increased the dependence of the eurozone on oil-producing and "gas-supplying" countries.

According to Bloomberg, gas storage facilities in Europe are currently only 56% full, which is 15% lower than the average over the past ten years. Wood Mackenzie analysts predict that if Russia refuses to increase gas supplies by the end of March, the level of energy reserves in Europe will fall by another 15%. If this happens, the storage facilities of the eurozone in terms of the gas contained in it will be at the lowest level in history.

Wood Mackenzie Vice President Massimo Di Odoardo admits that it will not be possible to avoid the predicted decline without Russia. The required level of gas reserves in Europe can be achieved only with the help of additional Russian supplies via the Nord Stream-2 pipeline or at least along the current routes. According to Di Odoardo, the coming year promises to be as unstable for European gas prices as the past one.

In 2021, exchange prices for gas in Europe reached record levels several times. On December 21, the cost of fuel in European countries for the first time exceeded $2,000 per 1 cubic meter. Experts of the Fitch rating agency linked this price surge with a decrease in the pumping of Russian gas through the Yamal-Europe gas pipeline and with reports of a possible severe cold snap this winter in the eurozone. The reason for the increase in gas prices could also be the news about the launch of the Nord Stream-2 only in the second half of 2022.

On December 30, the cost of gas dropped below $1,000 per 1 cubic meter. This was largely facilitated by the statements of the head of Gazprom, Alexey Miller, about the readiness of both branches of the Nord Stream-2 for operation. In addition, he added that the energy crisis in Europe is due to the fact that the European Commission abandoned long-term contracts at the time and gave preference to spot contracts. The drop in its own energy production against the background of the predicted cold winter, the current energy crisis is only aggravating.

Andreeva Natalya,
Analytical expert of InstaForex
© 2007-2025
Select timeframe
5
min
15
min
30
min
1
hour
4
hours
1
day
1
week
Earn on cryptocurrency rate changes with InstaForex
Download MetaTrader 4 and open your first trade
  • Grand Choice
    Contest by
    InstaForex
    InstaForex always strives to help you
    fulfill your biggest dreams.
    JOIN CONTEST

Recommended Stories

US Market News Digest for May 8, 2025. US stock indices close higher on trade deal optimism

Major US stock indices ended the session in the green, supported by statements from Donald Trump indicating progress in negotiations over a major trade agreement. The market interpreted this rhetoric

Ekaterina Kiseleva 14:00 2025-05-08 UTC+2

Gold slips, stocks sink: what India, Germany and the Fed have in common

Equities are falling on stalled tariff agreements ahead of the Fed decision. Gold is sliding on renewed US-China talks. UK and India have clinched a major trade pact. Friedrich Merz

12:36 2025-05-07 UTC+2

US Market News Digest for May 7

The major US stock indices closed in negative territory, with the S&P 500 down 0.8% amid growing uncertainty about trade policy and anticipation of new comments from the Federal Reserve

Ekaterina Kiseleva 12:20 2025-05-07 UTC+2

Gold falls, stocks plunge: What India, Germany and the Fed have in common

Stocks fall on lack of tariff deals ahead of Fed policy decision Gold falls on hopes for US-China trade talks; UK, India reach trade deal after 3-year talks Germany's Merz

Thomas Frank 07:05 2025-05-07 UTC+2

US Market News Digest for May 6, 2025

The US stock market opened the week in turmoil. Berkshire Hathaway shares were trading under pressure after Warren Buffett had Stepped down as CEO. Investors are concerned about the company's

Ekaterina Kiseleva 13:52 2025-05-06 UTC+2

$9 Billion for Skechers, falling indices, and surge in Asian stocks

Berkshire Hathaway slips after Warren Buffett steps down as CEO. The US services sector shows growth in April. Skechers surges following a $9 billion privatization deal. Investors await trade agreements

13:26 2025-05-06 UTC+2

Skechers' $9B, Indexes Sink, Asia Surges: A Day of Change

Berkshire Hathaway Slips After Buffett Steps Down as CEO U.S. Services Sector Rising in April Skechers Jumps After $9B Privatization Deal Investors Await U.S.-Partner Trade Deals Asian Currencies in Focus

Thomas Frank 07:41 2025-05-06 UTC+2

US Market News Digest for March 17

US stock indexes, including the S&P 500 and Nasdaq, ended the week confidently in positive territory. This was largely due to encouraging developments in trade talks with China and resilient

Ekaterina Kiseleva 13:32 2025-05-05 UTC+2

Europe on pause: What's behind the stock market plunge and Trump's unexpected activity

European stocks fell slightly; STOXX 600 - minus 0.1%, France - minus 0.3% Investors await data on US-China talks, earnings and Fed decision Trump: 100% tariffs on foreign films, Alcatraz

Thomas Frank 11:34 2025-05-05 UTC+2

US Market News Digest for May 2

US equity indices continue to climb despite lingering economic uncertainty. Investor optimism is being driven by expectations of progress in trade talks between the US and China. Nevertheless, ongoing economic

Ekaterina Kiseleva 13:14 2025-05-02 UTC+2
Can't speak right now?
Ask your question in the chat.
Widget callback
 

Dear visitor,

Your IP address shows that you are currently located in the USA. If you are a resident of the United States, you are prohibited from using the services of InstaFintech Group including online trading, online transfers, deposit/withdrawal of funds, etc.

If you think you are seeing this message by mistake and your location is not the US, kindly proceed to the website. Otherwise, you must leave the website in order to comply with government restrictions.

Why does your IP address show your location as the USA?

  • - you are using a VPN provided by a hosting company based in the United States;
  • - your IP does not have proper WHOIS records;
  • - an error occurred in the WHOIS geolocation database.

Please confirm whether you are a US resident or not by clicking the relevant button below. If you choose the wrong option, being a US resident, you will not be able to open an account with InstaForex anyway.

We are sorry for any inconvenience caused by this message.