Taps Coogan – December 15th, 2022
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With cold weather finally descending on Northern Europe, and the wind not blowing, gas is being withdrawn from EU storage at the fastest pace since in years, as the following chart from BertHub highlights.
The redline in the chart above shows the daily injection/withdraw rate of gas in EU storage. The current withdraw rate is now eclipsing the max withdraw rate from the 2021/2022 winter. Typically the winter’s maximum withdraws happen in seasonally-colder January and February.
The good news for the EU is that total storage levels remain very high, higher than the max levels seen in 2021.
As we noted back in September, the EU can probably make it through this winter without full blown blackouts thanks to high storage levels and demand curtailment. Of course, the availability of gas doesn’t guarantee the availability of sufficient generating capacity when the wind isn’t blowing. That’s a whole separate issue related to phasing out baseload generating capacity.
With China finally reopening, demand for LNG is expected to rise. CNOOC, the largest energy company in China, is reportedly on the hunt for additional LNG cargos yet only one LNG export terminal is expected to come online in 2023 (it’s in Russia). Refilling the EU’s is storage is going to be the real challenge next year. After that, things aught to improve. In 2024 several new terminals are expected to come online in the US, Mozambique, Russia, and elsewhere.
FYI BertHub is a great resource for viewing real-time EU pipeline gas imports and storage levels.
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