The European Union has stepped up efforts to fill its gas reserves before the next heating season, with member states facing a tightening deadline and reduced supplies from the Persian Gulf following the closure of the Strait of Hormuz.
European storage levels stood at 34.3 per cent of capacity on May 13, well below the 80 per cent minimum target set for November 1, according to Spanish energy consultancy Tempos Energía. To meet the deadline, Europe needs to inject 45.7 percentage points in under five months – a pace that would require 130 liquefied natural gas (LNG) cargoes per month, 10 more than in 2024.
The European Commission relaxed its gas storage obligation from 90 per cent to a minimum of 75 per cent earlier this year, citing market pressures. The shift, agreed amid the Middle East conflict, gave member states more flexibility on timing but has also drawn criticism for thinning Europe’s buffer.
The Strait of Hormuz has been closed to commercial shipping since March 4, when Iran blocked the waterway in retaliation for joint US-Israeli airstrikes on its territory. QatarEnergy, one of the EU’s main LNG suppliers, declared force majeure on the same day, freezing exports that account for roughly 12 to 14 per cent of EU LNG imports.
“Since the war began, only two LNG tankers have crossed the strait, representing less than 3 per cent of normal daily traffic – those cargoes simply do not exist,” said Antonio Aceituno, director general of Tempos Energía.
The Dutch TTF benchmark, the reference price for European gas, has remained elevated since the closure, with futures contracts showing an unusual backwardation curve in which summer prices trade above winter prices. According to Tempos Energía, the pattern discourages injection during the refill season and could leave depots short heading into winter.
Should the strait reopen in June, the first LNG cargoes from the Gulf would arrive in Europe by late July via alternative routes, the consultancy said. In that scenario, European reserves could reach 70 to 75 per cent of capacity before the heating season begins – above critical levels but below the five-year average.
Should it remain closed, June could become “the first breaking point for the bill”, with TTF prices estimated to move between €52 and €62 per megawatt-hour.
Germany, the EU’s largest gas consumer, has been flagged as the weakest link. Its Rehden facility, the bloc’s largest underground storage site, was around 23 per cent full at the end of the heating season, according to Bloomberg.
The European Commission has presented a plan to phase out all Russian gas and oil imports by 2027, banning new contracts from this year and ending existing ones by the end of next year.
