European gas supplies are facing a double threat this winter from ongoing infrastructure bottlenecks and the escalating conflict between Ukraine and Russia. This is reported by industry analysts who cite the publication Montel.
Even as Europe’s gas storage reaches an unprecedented 100 billion cubic meters, concerns remain about the continent’s ability to allocate gas efficiently and keep supplies stable.
“While gas storage is full, the real question is whether the gas will reach the point where it is most needed,” said Christoph Halser, lead European gas market research analyst at Rystad Energy, during the Montel Winter Gas Supply Outlook webinar. which took place this week.
Halser singled out pipeline bottlenecks, particularly in Eastern Europe and the Balkans, as major threats to energy security.
Nadia Martin Wiggen, director at Svelland Capital, echoed these concerns, adding that “we still see a need for more LNG cargoes to enter Europe by the end of this year.”
Although the U.S. is a key supplier, sufficient LNG is not expected until early 2025, Wigen noted.
For his part, Halser added that Slovakia and Austria, which rely heavily on gas transit through Ukraine, are particularly vulnerable at the moment. Even with alternative LNG supplies, these countries could face disruptions if infrastructure issues are not addressed.
The conflict between Ukraine and Russia, especially the recent hostilities in the Kursk region, also has an immediate impact on European crude oil prices.
Since the surge began last week, levels have risen, with the Dutch benchmark TTF market accounting for next months’ supply – already hitting its highest point since December at EUR42.90/MWh natural gas purchases.
Some experts believe that European natural gas prices could jump by 10-20% if Russia or Ukraine decide to stop gas flows through the critical Suja transit point.
Ukraine recently claimed that it had taken full control of the Suja gas compressor station, but the information could not be confirmed so far by independent sources.
Halser and Wiggen, however, suggest that the risk of Ukraine closing this key entry point is low, as Kiev “may one day apply to join the EU” and halting transit could harm Europe’s economic prospects.
The contract for the transit of gas through Ukraine expires at the end of this year and there are currently no indications that it will be renewed.
Future gas swaps could also be threatened by the suspension of transit through Suja, the experts added. Wiggen also warned that Europe should not expect a renewal of pipeline gas supply agreements with Russia in January, dir.bg writes.
dnes.bg
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