Bloomberg predicts EU LNG reserves to fall by up to 30%

The cessation of gas transit from Russia to the European Union (EU) via Ukraine will reduce storage reserves to 30-35% by April. This was reported by Bloomberg on February 6.

"Under current trends, stored gas will continue to decline in February and March, reaching about 30-35% of capacity by the end of the current winter in early April, compared with 55-60% in the previous two seasons," the publication said.

Bloomberg reports that EU rules indicate that gas reserves must be restored to 90% of capacity by Nov. 1. For this purpose, Europe needs to purchase a resource equivalent to 725-750 TWh. Purchases of fuel for storage facilities are usually made in summer, when its price is cheaper. However, as the agency writes, this year the market may react unconventionally due to expectations of increased demand from the EU, which may lead to an increase in the cost of the resource.

Unfreezing prices: why Europe is again threatened by gas shortages

The cost of blue fuel may stay at high levels for a long time to come

Earlier, on February 3, Dmitry Skryabin, portfolio manager of Alfa Capital Management Company, said that the dynamics of gas prices in January in the European Union was determined by geopolitics in addition to the weather factor. In particular, we are talking about the termination of Russian gas transit through Ukraine. According to him, closer to the middle of spring, there may be a seasonal correction in prices. Then the weather factor will be excluded from the quotations, but the geopolitical factor, for example, will remain in full force.

Ukraine has officially announced its refusal to extend the agreement with Russia on gas transit to Europe after the contract expires on December 31, 2024.

On January 1, 2025, Gazprom announced that it would suspend gas supplies through Ukraine. On the same day, Slovak Prime Minister Robert Fitzo said that this would have drastic consequences for the EU, but not for Russia.