Storage tanks in Europe are brimming with cheap LNG
Time:2024-08-11
With prices for the fuel near their lowest in three years, traders may also be betting on a recovery by filling up LNG storage sites in the nation, which account for almost a third of Europe’s total capacity. Shippers are continuing to buy gas despite the tanks being almost full.
LNG inventories are above 5-year average for time of year
It’s another example of how gas storage tanks are filling up across the continent to reach peak levels way before heating demand kicks in. That leaves a bigger-than-usual buffer for potential shocks in the winter, increases trading opportunities for when prices rise and raises questions about whether Europe can absorb all the gas that’s flowing in.
“Northwest Europe has had most of the gains in LNG deliveries this year owing to the ability to sell cargoes into highly liquid markets,” said Leyra Fernandez Diaz, a gas analyst at Energy Aspects Ltd. “But the physical options to absorb more gas in the power sector, turn down Algerian receipts and use more of the country’s spare LNG terminal capacity have allowed Spain to act as a considerable LNG sink as well.”
