Click here to learn about more than 150 oil prices
Start trading CFDs on another 2200 instruments
Click here to learn about more than 150 oil prices
Click here to learn about more than 150 oil prices
Start trading CFDs on another 2200 instruments
Click here to learn about more than 150 oil prices
Click here to learn about more than 150 oil prices
Start trading CFDs on another 2200 instruments
Click here to learn about more than 150 oil prices
Click here to learn about more than 150 oil prices
Start trading CFDs on another 2200 instruments
Click here to learn about more than 150 oil prices
Learn More
As Europe enters the heating season with inventories of herbal fuels at their lowest level in a decade, lawmakers, consumers and industries are left at the mercy of the weather, hoping for a mild winter for further tightening of europe’s already tight fuel market. In the colder-than-usual winter of 2020/2021, Europe has struggled to fill fuel shop sites at good enough levels in recent months, as Asian buyers took over LNG shipments. sets is compatible with equivalent values in Europe.
Even though the global fuel surge originated from extraordinarily low stocks in Europe and has led to record spot LNG in Asia, Asia is winning the auction war for spot LNG supply, leaving Europe with insufficient supply.
This winter, unlike last winter, primary LNG buyers like Japan and South Korea have to further secure their source and prepare if this winter is as bloodless as the previous one.
As a result, “Europe has had a less fluid source to fill the garage with fuel, and now the region is heading into winter with the garage only 71% full,” BloombergNEF estimates, to the five-year seasonal norm of 92%,” BNEF said. in an investigation this week.
In this scenario of low fuel inventories and an already tight fuel market, a colder winter may push fuel costs in Europe to new records in the coming months, boost the rush for coal and petroleum products, and leave Europe without fuel in inventory at the end of the heating season. which would raise fuel costs until 2022, as the continent will want to fill its source before next winter.
Related: Why Iraq Can, Won’t Reach, 8 Million Barrels Per Day of Oil Production
On the occasion of a bloodless winter, Europe will want an additional supply, and this is unlikely to come from too much additional LNG, especially an equally bloodless winter in Asia, which has the motivation and purchasing power to outstepped offers of cargoes outside Europe.
“Under an unusually mild winter, low fuel inventories and expected sustained demand are expected to keep fuel costs in Europe and Asia at the highest levels through the last quarter of 2022,” TotalEnergies said in its third-quarter earnings this week.
Norway, Europe’s second-largest fuel supplier after Russia, is expanding fuel deliveries this winter after Equinor allowed fuel exports from the Oseberg and Troll fields to increase.
However, Equinor says that even a general winter, to mention a colder winter, would be a constraint on European fuel supply.
Russia announced this week that it would begin filling European garage sites once Gazprom completed filling Russian garages, but Moscow also said a rapid buildup of sources for European consumers would come as soon as the German government approved the dubious Nord Stream 2 pipeline.
Russian President Vladimir Putin told Gazprom CEO Alexei Miller on Wednesday that as soon as the Russian fuel giant finishes filling Russia’s underground garage until November 8, “I would like you to begin a coherent and planned task to increase the amount of fuel in its basement tanks in Europe, in Austria and Germany,” according to the English translation on the Kremlin’s website.
Europe may not have enough herbal fuel to meet the call for a bloodless winter, especially if the Asian winter is also bloodless, unless Russian fuel deliveries increase, energy consultancy Wood Mackenzie said in early October.
In general winter weather conditions, Europe will not have a challenge in assembly demand, despite existing low storage grades, said Massimo Di Odoardo, vice president of fuel and LNG studies at WoodMac.
“The formula squeaks if there is a bloodless winter in Europe and Asia. Higher heating demand could succeed at 20 Gm3 in Europe and 10. 5 Gm3 in Asia, leading to a decline in LNG imports in Europe. “This would absorb all the fuel left in European storage, and fuel costs could go much higher than we have noticed so far,” he said.
“The sky may be the limit of European fuel costs this winter,” Di Odoardo added.
By Tsvetana Paraskova for Oilprice. com
More about Oilprice. com:
back to home page