How Europe's gas storage helped balance the European - and global - gas market
By the end of March, Europe had 33 bcm of gas storage in place, just 1 bcm above the 5-year average (2015-19). Given that there were very high stocks at the beginning of the winter season, this represents a significant increase in storage withdrawals over the winter, similar to what might have been expected during a particularly cold winter. Whilst the winter weather was colder than either of the two previous, very mild winters, we would not have expected to see the level of withdrawals that occurred. However, a period of very cold weather in North East Asia during January resulted in greatly increased Asian LNG spot prices, which gave the necessary signals for spot LNG cargoes to be diverted away from Europe. This was largely backfilled by the call on European storage at a time when stocks were plentiful. This undoubtedly contributed to fast stock withdrawals leaving the gas storage market in a more balanced position than it has been in for several years.