Daily Energy Report
Gas storage levels in Europe, OPEC+ June meeting, China’s coal imports, Urals oil price, Canada’s Trans Mountain pipeline, Acadian pipeline system expansion, and more
CHART OF THE DAY: Gas Storage Levels in Europe
The gas storage levels in top European storage capacity holders show healthy signs, standing at 73% in Germany, 72.5% in Italy, 67% in the Netherlands, and 74.2% in Austria, as shown in Figure (1) above.
The lowest storage level is seen in France where gas stockpiles stood at 49.73% on May 26. In March, the Elengy-operated LNG terminals (Fos-sur-Mer and Montoir-de-Bretagne) went offline for a couple of weeks due to a labor strike against pension reforms proposed by the French government. Gaz Opale, the operator of the Dunkerque LNG terminal, was also forced to declare force majeure on March 8, but operations later resumed within a few days.
EOA’s Main Takeaway:
The continuing downward trend of the Dutch TTF (the European benchmark for gas contracts) is expected during the early months of summer when demand usually decreases, and the injection rates into gas stockpiles become higher than the withdrawal rates. Thanks to a glut of LNG supplies from the US and Russia, the European Union member states ended the heating season with overall high gas storage levels that stood at 58% at the end of April and later increased to 66.96% on May 26.
We expect an improvement later this year in LNG prices. The recovery in China’s LNG demand, in addition to potential heat waves during the summer season, and prolonged maintenance activities at several LNG plants in the upcoming months, could help raise prices if the European economy remains healthy and shows some signs of growth.