Germany is expected to miss its 95% gas reserve target on November 1 after Russia keeps the Nord Stream 1 pipeline closed indefinitely, told to Bloomberg by people familiar with the matter.
This follows after Europe’s largest energy exporter announced that it hit the 85% level in its reserves by September 1, one month ahead of schedule. The announcement relaxed the gas futures market to make prices fall sharply back below €300.
“We will have to see that in the coming weeks,” an Economy Minister spokesperson commented about hitting the November target.
Russian state-owned gas exporter Gazprom’s response meanwhile was an eleventh-hour announcement to keep the pipeline closed indefinitely due to an alleged leakage. The halt comes after the pipeline was scheduled to reopen after its sudden three-day routine maintenance.
Despite Berlin’s huge strides to be less dependent on Russian gas imports, the recent pipeline shutdown is still expected to put a strain on reaching the storage targets.
“If we are now down to zero flows via Nord Stream, it might be difficult to reach storage goals,” said German state utility regulator Uniper CEO Klaus-Dieter Maubach. “It all depends on the weather and on how demand will develop.”
The constricting of the Russian gas flowing out of the Nord Stream pipeline is also a contributing factor for the European Union to hold an emergency meeting to discuss measures it can take to address the worsening energy crisis. Some of the moves the union is considering include putting price caps on natural gas used for power generation, capping a price ceiling on gas imports from Russia, and suspending trading on power derivatives markets.
Information for this briefing was found via Bloomberg and the sources mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.