According to the data from Gas Infrastructure Europe, on January 27, gas reserves in Europe tumbled by 39.65%. This is 15.6 percentage points lower than the average reading in the last 5 years.
According to the estimates, gas reserves in underground storages dropped below 40%. In the recent months, gas consumption turned out to be 1/3 higher compared to the last 5 years. Meanwhile, experts at Gas Infrastructure Europe emphasize that imports of liquefied natural gas to the European Union increased by 2.7 times (to 10.3 billion cubic meters).
Although in January 2022, the weather in Europe was quite warm, gas consumption surged. Holders of European gas storages used the fuel to cap surging prices. Notably, the price of gas contracts with the execution in the following month reached an all-time high. Notably, at the end of December 2021, gas cost $1,310 per 1 thousand cubic meters on the TTF hub. The highest price was recorded at $2,138 per 1 thousand cubic meters. At present, it is better to buy liquefied natural gas in the spot market since its average price totals $976 per 1 thousand cubic meters.
Gas flow to Europe slumped amid the current strategy of its importers. In the first half of January, Gazprom reduced its exports to distant foreign countries by 40%. Analysts suppose that in the next few months, the situation will hardly alter. However, in February, the volume of export may change amid gas price stabilization.
Specialists at Gas Infrastructure Europe think that the current level of gas reserves corresponds to the readings recorded in the middle of winter. They have estimated that from 2011, the average level of gas reserves at the end of a cold season usually totals 36%. This year, the record is likely to be renewed. In February and March, European countries may continue using gas. Under the current conditions, March is considered another winter month. That is why Gazprom has altered its seasonal export strategy.
At the moment, European gas underground storages contain 43 billion cubic meters. While gas reserves are becoming smaller, daily production is also falling. Specialists suppose that in the near future, it will be very hard to meet the daily demand of gas production.
