The winter in Europe has just ended but analysts have already made new gloomy predictions for the next winter season. After months spent worrying about shrinking supplies and soaring prices, market participants breathed freely. However, analysts are confident it is too early to be optimistic about the future.
The EU avoided a severe energy crisis this winter thanks to sufficient fuel supplies and abnormally warm weather. Thus, dismal forecasts did not come true. However, the prophets of gloom and doom are not ready to give up. There are more winters ahead, which means that the risks still exist.
Analysts made their predictions based on a report from economists at the International Energy Agency (IEA). At the Munich Security Conference, Dr. Fatih Birol, the Executive Director of the IEA, warned Europe "against complacency ahead of next winter. He made a good assessment of the EU’s efforts to mitigate the energy crunch this winter. However, he predicted a rougher winter season in 2024. Dr. Birol also called on Europe to deliver "a new industrial master plan through bold and ambitious policies."
Earlier, the European Commission foresaw a shortage and an uptick in gas prices next winter. Apart from that, in 2024, Europe is likely to face higher inflation as "price pressure may turn out broader and more entrenched than expected."
