Europe could be left with some gas in storage after this winter, but it will likely struggle to fill that storage ahead of winter 2023/2024, Fatih Birol, the Executive Director of the International Energy Agency (IEA), said on Wednesday.
Europe could end the coming winter with gas storage sites 25%-30% full, but next winter could be even more difficult, Birol said as quoted by Reuters.
Earlier this week, the IEA said in its quarterly Gas Market Report that soaring natural gas prices, demand destruction in the industrial sector, and energy-saving measures are set to reduce gas consumption in Europe’s developed economies by 10% this year, the biggest drop in European demand in history. After a record slump in gas demand this year, Europe faces another year of gas consumption contraction in 2023, when OECD Europe’s demand is forecast to decline by 4% amid high prices, according to estimates from the IEA.
The agency’s head Birol said last week that the gas market could be even tighter next year compared to already tight LNG markets in 2022.
In addition, analysts say that Europe’s energy crisis will not be a “one winter story.”
Reduced energy supply due to the sanctions against Russia and Moscow shutting down key pipeline gas export routes will leave Europe scrambling for oil and gas well after the coming winter as the current crisis is not “a one winter story,” according to analysts at consultant Energy Aspects.
“This is not a one winter story, let’s just make it very, very clear,” Amrita Sen, founder and director of research at Energy Aspects, told Bloomberg television in an interview last month. Europe will need to ration demand in order to be able to balance the market, not only this winter but also the next winter and potentially the one after that, she noted.
By Tsvetana Paraskova for Oilprice.com
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