European UGS facilities are emptying too fast

European countries have spent far too much effort preparing for winter, filling up their underground gas storages (UGS), making the raw materials pumped into them almost equivalent to gold or other valuable material. Now, with the arrival of a sharp cooling, many EU countries are forced to intensively select what they have been accumulating for so long. The dynamics is more than menacing: withdrawal exceeds injection, although in late November and early December of this year, maximum gas imports to the EU from the USA, Norway and Azerbaijan were recorded.

However, EU UGSFs are emptying too quickly, with raw materials in storage tanks dropping from 97% to below 90% in just a few weeks. At the same time, the cold has not yet reached its peak, according to the forecast, the temperature will fall, which will lead to higher fuel prices, shortages and, of course, a decrease in stock levels.



Based on the Gas Infrastructure Europe (GIE) report, at the end of the gas day, which ended on December 8 at 08:00 Moscow time, blue fuel stocks in storage decreased to 89,93%, losing 0,47 percentage points. At the same time, the rate of pumping out the resource remains above average. The most active selection rates for the reporting day were observed in Belgium (1,49 p.p.), France (0,87 p.p.) and Slovakia (0,78 p.p.).

In general, the short-term outlook is disappointing. The latest Bloomberg analysis shows that the average temperature in NW Europe is expected to continue to fall below the 30-year trend line and be around minus 4 degrees Celsius by December 18. Not only analysts take into account these data, but also traders, which is why the market began to fluctuate and responded with a rise in price, which was reflected in futures contracts.