Intense heatwaves across the EU and Asia have escalated consumption and heightened competition for global shipments, as reported by the outlet.
Europe’s natural gas reserves are unusually low for this time of year, Bloomberg has indicated, attributing this to increased demand for air conditioning amidst a regional heatwave.
Underground storage facilities are currently filled to approximately 62% capacity, the outlet stated, in contrast to typical levels of around 80% by early summer, which usually provides a robust buffer before the winter heating season.
Extreme temperatures in Asia have also resulted in fuel shipments being redirected away from Europe, as buyers globally compete for limited supplies. Consequently, European natural gas futures have remained near a two-week peak, signifying that “the continent must pay more to ensure supply continues,” the outlet noted.
Despite this trend, the EU might still be able to top up its gas inventories to about 80% by the end of the summer, the outlet cited a Goldman Sachs note as suggesting.
The EU imports nearly 90% of its natural gas, with Russia still providing a significant share of the supply despite sanctions.
In May, European Commission President Ursula von der Leyen unveiled a strategy to phase out all Russian oil and gas imports by the close of 2027, as part of the EU’s REPowerEU roadmap. This initiative aims to eliminate the bloc’s reliance on fossil fuels from Russia and transition to renewable sources.
The plan has drawn criticism from landlocked Hungary and Slovakia, which have relied heavily on Russia’s pipeline gas. Bratislava blocked the EU’s 18th sanctions package, which targeted Russia’s energy and financial sectors, citing risks of shortages and rising prices. Budapest has also joined the veto, exerting pressure on the bloc to make concessions related to energy and broader RepowerEU rules.
Moscow has asserted that the EU restrictions are self-defeating, causing surging energy prices and weakening the bloc’s economy. Since 2022, Germany, the bloc’s largest economy, has entered a recession, while growth across the EU has stalled.