European Natural Gas Inventories May Drop to 15-Year Low, Winter Price Risks Rising
Taylor Wilson
EU gas storage is on track to end the refill season at just 76% full — the lowest peak since 2011 — as the Hormuz Strait blockage squeezes LNG supply and winter price-spike risk builds.
How low are reserves, exactly?
Wood Mackenzie forecasts EU storage will reach only about 76% capacity by end of the refill season (April–October) — the lowest peak since 2011.
Gas Infrastructure Europe data puts current fill at just 48%. After a cold winter, the April starting point was only 28%, well below the seasonal norm.
This means → Europe is refilling from a hole. A lower starting line almost guarantees a lower finish.
Why can't Europe fill up?
The direct cause: the Hormuz Strait — normally carrying roughly one-fifth of global LNG (liquefied natural gas, chilled for tanker transport) supply — has been disrupted by the US–Iran conflict, suppressing Qatari and UAE output.
The indirect cause: Europe's benchmark gas price sits at about €40 per megawatt-hour, far below the €342 peak after the 2022 Russia–Ukraine conflict.
In plain terms = prices are too low to pull American LNG cargoes toward Europe. Higher-bidding Asian buyers are winning the ships.
Why does Qatar's restart timeline matter so much?
Goldman Sachs analyst Samantha Dart estimates that if Qatar's undamaged units at Ras Laffan return to full output by end of July, season-end fill could reach 74%. A delay to end of August drops that to just 70%.
Qatar's prime minister said this week that all facilities except two Iranian-struck units would resume normal output within weeks.
This means → a one-month delay in restart swings storage by 4 percentage points. The window is very tight.
Has the strait risk gone away?
A vessel was attacked in the Hormuz Strait as recently as Thursday. Whether shipping stays open after the US–Iran 60-day ceasefire extension expires remains uncertain.
Energy Aspects notes that commercial speculators are increasing bets on high winter prices in futures and options markets.
This reflects a market that does not believe the strait risk is behind us — traders are pricing "something could go wrong this winter" with real money.
What is the EU doing about it?
The European Commission says "current stock levels do not raise immediate energy-security concerns" and considers 80% fill sufficient for winter. It has already cut the recommended target for member states from 90% to 80%, even 75%.
At the same time, the EU plans a full ban on Russian LNG imports from January 1, 2026. Russian LNG currently accounts for about 14% of Europe's total LNG imports.
In plain terms = the EU is lowering its fill target to avoid pushing up short-term prices, while simultaneously cutting off a source that supplies 14% of its gas. The two goals work against each other.
Where are winter prices headed?
Wood Mackenzie's European gas director Tom Marzec-Manser expects prices to drift lower in coming months as more LNG cargoes depart, but to rise again heading into winter, with a cold-weather scenario in early 2027 posing significant risk.
Argus Media analyst Natasha Fielding warns: "The longer LNG supply stays constrained, the lower Europe enters winter — and the greater the risk of a price spike."
This means → near-term price declines may actually make things worse. Cheaper gas weakens the economic incentive to refill — the less you stock, the more expensive winter becomes. A vicious cycle.
Content is for reference only, not financial advice.