{"id":4070,"date":"2023-03-06T14:44:49","date_gmt":"2023-03-06T14:44:49","guid":{"rendered":"http:\/\/roydadnaft.ir\/English\/?p=4070"},"modified":"2023-03-06T14:44:51","modified_gmt":"2023-03-06T14:44:51","slug":"with-winter-almost-over-europes-gas-stocks-are-at-seasonal-record-high","status":"publish","type":"post","link":"https:\/\/roydadnaft.ir\/English\/4070\/","title":{"rendered":"With winter almost over, Europe\u2019s gas stocks are at seasonal record high"},"content":{"rendered":"
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With Europe rapidly nearing the end of the winter heating season, there is increasing confidence the region will have a record volume of gas still in storage, resulting in downward pressure on futures prices.<\/p>\n\n\n\n

Stocks in the European Union and United Kingdom amounted to a seasonal record 685 terawatt hours (TWh) on March 1, and storage was almost 61% full, according to data from Gas Infrastructure Europe (GIE).<\/p>\n\n\n\n

Inventories were +272 TWh (+66% or +2.55 standard deviations) above the prior ten-year average, compared with a deficit of -87 TWh (-21% or -0.82 standard deviations) on the same date last year.<\/p>\n\n\n\n

Storage fill is at record levels and far above the 39% seasonal average for the last decade (\u201cAggregated gas storage inventory\u201d, GIE, March 3).<\/p>\n\n\n\n

Reflecting bulging inventories, front-month futures prices have slumped to just 45 euros ($47.71) per megawatt hour from 189 euros when the winter season started on Oct. 1 and a peak of 339 euros in late August 2022.<\/p>\n\n\n\n

Based on previous seasonal movements, inventories are projected to deplete to a low of 617 TWh before the winter drawdown ends, with a probable range from a minimum of 569 TWh to a maximum of 667 TWh.<\/p>\n\n\n\n

The projected carry out is the highest on record, surpassing the previous record of 609 TWh at the end of winter 2019\/20, and far above the ten-year average of 345 TWh.<\/p>\n\n\n\n

As the end of the winter draws near, there is increasing confidence in this projection, with the range of probable outcomes down to just 98 TWh from 311 TWh on Jan. 1 and 430 TWh on Oct. 1.<\/p>\n\n\n\n

As a result, storage sites are expected to be almost 55% full on March 31 compared with just 26% on the same date in 2022.<\/p>\n\n\n\n

On average, stocks fall to a post-winter minimum around March 30, with the low occurring at the earliest on March 16 (winter 2011\/12) and at the latest on April 19 (winter 2020\/21).<\/p>\n\n\n\n

Inventories are therefore expected to continue depleting for another 27 days, with a range from 13 to 47 days, depending on both temperatures across the region and prices.<\/p>\n\n\n\n

Europe\u2019s consumption has been reduced through a combination of industrial closures, public information campaigns to reduce energy use, and milder than usual weather, coupled with brisk imports of LNG.<\/p>\n\n\n\n

In 2022, EU governments directed utilities and storage operators to maximise stocks, irrespective of cost, to maximise supply security and protect against cold weather or any further loss of pipeline flows from Russia.<\/p>\n\n\n\n

So far this winter however the number of heating degree days at Frankfurt in Germany, a proxy for the Northwest Europe macro region, has been around 8% lower than the ten-year average.<\/p>\n\n\n\n

The European Centre for Medium-Range Weather Forecasts predicts temperatures will be slightly colder than average for the seven days between March 6 and March 13, but after that warmer through the end of March.<\/p>\n\n\n\n

Futures prices are sliding to arrest the swelling surplus by encouraging more consumption from industry and power generators and re-routing liquefied natural gas (LNG) tankers to alternative markets in South and East Asia.<\/p>\n

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