(Finance) – In Europe, the filling levels of storages Of gas reached a new seasonal high: on September 2, deposits were 93.1% full, a new record, vs. a 5-year average of 81.4% and a low of 68.1% in 2021. Therefore, European warehouses could reach full capacity by the end of September. These are some of the indications contained in the Focus Gas&Power published by Intesa Sanpaolo.
According to the report the European demand of gas is destined to remain limited: total gas demand is around 15% lower than average, even considering the impact of climate, and could remain 10% lower than average until at least mid-2024 due to of optimization and energy saving, the weakening of industrial production and the risks of recession.
Therefore, given the anemic demand, i risks linked to supply they drive prices and fuel volatility. The study highlights that the main sources of concern are a potential strike in Australiawhich could reduce LNG exports and intensify competition between Asia and Europe, planned and unplanned maintenance work in Norwaywhich reduced Norwegian flows to Europe to the lowest levels since 2015 and escalation in the war between Russia And Ukraine and threat of a blockade across the Black Sea.
However, with gas storages filled to maximum capacity, gas demand could decline further in late September and October. Therefore, if the weather conditions were favorable and the risks of reductions or interruptions in flows eased, gas prices could temporarily decrease further (but should still remain well supported above the support band guaranteed by coal-to-gas switching and estimated at around 23-25 euro/MWh).
THE price risks they remain biased upwards in the winter season due to various threats of interruption or reduction of supplies, possible unfavorable weather conditions, Asian competition in LNG markets and uncertainty over electricity production from nuclear or renewable sources.