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Europe faces winter LNG crunch as storage hits decade lows
Europe says it needs to buy more than $8.1 billion of gas at current prices to reach even a 75% storage target before December.
Europe is heading into winter with natural gas in storage at one of the lowest levels in nearly two decades, setting up tougher competition for liquefied natural gas supplies as demand rises ahead of colder months. OilPrice reports that both Europe and Asia are chasing a smaller pool of available LNG cargoes.
The situation is being worsened by disruptions to Middle East LNG deliveries, with LNG from Qatar still blocked at the Strait of Hormuz. OilPrice also points to the war in the Middle East cutting LNG supply and lifting gas and LNG prices in Europe and Asia.
Higher European benchmark prices, with front-month futures above later contracts, have discouraged additional stockpiling during much of the summer. OilPrice says Europe still needs to fill storage before December to reduce the risk of a winter supply crunch.
OilPrice reports that, based on current prices, Europe must buy gas worth over $8.1 billion to reach even its lowest storage target of 75%.
Latest closeNat gas $3.008 ▲3.6%