EU Faces Perfect Storm of Low Gas Storage and Diesel Shortages this Winter

The European Union is facing a challenging winter due to its dependence on energy imports. Gas storage levels are significantly lower than usual, and diesel shortages are threatening fuel oil supply security for the heating season.

The issue began in March when the U.S. and Israeli war against Iran disrupted Qatar's LNG export infrastructure, forcing Qatar to declare force majeure on exports. The EU, which sources about 21% of its energy from natural gas, is heavily dependent on LNG imports since it ended Russian pipeline imports amid its Ukraine war-related sanction push.

Wood Mackenzie reported that the benchmark gas price in the EU has gone up by 50% since mid-June. Gas storage is only just above 50% full, an historically low level at this time of year, raising concerns over how much gas Europe will be able to secure ahead of the 2026/27 winter heating demand season.

Rystad Energy analyst Janiv Shah warned that if imports of LNG continued at the current subdued pace, the EU would have its gas storage only 75% by November. This is considerably lower than the target of 90% set for member states back in 2022.