‘Winter panic’: EU gas stores at their lowest level in 13 years

 

‘Winter panic’: EU gas stores at their lowest level in 13 years

 

As one of Europe’s biggest consumers of gas the UK may be particularly exposed to heightened price volatility

 

Jillian Ambrose

Sat 29 Aug 2026 06.00 BST

https://www.theguardian.com/business/2026/aug/29/european-gas-stores-lowest-13-years-eu-price

 

Europe is on course to enter the cooler months with gas stores at their lowest level in 13 years, which has triggered “winter panic” among energy traders, experts have warned.

 

The EU’s gas stocks were 63% full in the last week of August, well below the 80% average for late August over recent years and among the lowest levels ever recorded for this time of year.

 

At the current sluggish rate of gas storage injections, the EU is likely to enter the winter heating season with gas stocks about a fifth below the five-year average, and at their lowest level since 2013, according to Greg Molnar, a gas analyst and professor.

 

“Low storage levels are naturally increasing the risk of heightened winter price volatility,” he said, which could be made worse by “cold spells or slow wind patterns” increasing gas usage over the winter.

 

The UK may be particularly exposed to market volatility, because it is one of the biggest gas consumers in Europe but has some of the lowest levels of domestic gas storage capacity.

 

Typically, the UK relies on imports of gas via pipeline from Europe or tankers from the US and the Middle East. Chris O’Shea, chief executive of the British Gas owner Centrica, said this week the UK had “almost no gas in storage” for the coming winter.

 

The EU’s gas stores have struggled to rise towards a watered-down target of 80% full by the start of winter, since the US-Israel war on Iran triggered severe disruption to exports of oil and gas from the Gulf region.

 

A cold end to last winter, and higher-than-usual gas power generation during Europe’s heatwaves this summer, have also contributed to the bloc’s depleted gas stores. In a typical year, owners of storage facilities fill them up during the summer when both demand and prices are lower.

 

Europe’s gas market prices have “stayed relatively calm” this summer in the hope that the strait of Hormuz would be reopened and winter stocks could be rebuilt. However, “no one expects it to happen any time soon”, according to Bjarne Schieldrop, chief analyst commodities at the Nordic banking group SEB.

 

“As a result, the European natural gas market has run into a bit of a winter panic over the past week,” Schieldrop added.

 

Although Europe is not expected to experience physical shortages of gas this winter, traders expect higher prices.

 

Benchmark gas price has climbed to three-year highs above €68 per megawatt-hour (MWh) in recent weeks, more than double the price at the start of the year. Prices have risen sharply on the growing expectation that market traders in the EU will need to compete with Asian buyers to secure cargoes of liquefied natural gas as temperatures begin to cool.

 

Without a return of gas exports from the Middle East, Europe’s benchmark price “would likely need to move above €100/MWh” to attract enough shipments of gas to meet winter demand, according to analysts at Goldman Sachs.

 

Gas supply concerns are particularly acute in western Europe, where storage levels are well below those in countries such as Italy and Poland, which have managed to top up their gas stores to over 80% full.

 

In Germany, which has Europe’s largest gas storage capacity, facilities are about half-full, according to Gas Infrastructure Europe. Storage levels in Belgium and the Netherlands, which connect directly to the UK gas market via gas pipelines, stand at 51% and 45%.

 

The UK’s reliance on global gas imports is expected to deepen as declining gas production from the UK’s North Sea sector accelerates, and Norwegian output begins to fall from 2030.

 

The government is considering plans to provide direct financial support to safeguard domestic gas infrastructure, after an official consultation found that homes and businesses risk running out of gas within the next decade, despite its growing clean energy sources.

 

This could include offering financial support to the owners of gas storage facilities and pipeline operators, to make it economically viable to upgrade and maintain them in the decades ahead.

 

The UK energy regulator, Ofgem, said this week that typical gas and electricity bills will rise by 4% from October under its quarterly cap, after climbing 13% at the start of July, to take account of global energy market price rises caused by the war on Iran.