Europe faces worst gas crisis in 15 years as storage levels hit record low

The European Union is facing a severe energy crisis as data from consultancy Wood Mackenzie indicates that by October, EU underground gas storage will be only about 76% full—the lowest level since 2011. This raises concerns about renewed price spikes and energy supply disruptions.

Several interrelated factors are behind the current situation. First, the conflict in the Middle East has disrupted liquefied natural gas (LNG) shipments through the Strait of Hormuz, a critical route that normally handles a fifth of global LNG exports. Additionally, production cuts in Qatar and the United Arab Emirates have further constrained global supply.

Second, last winter was unusually cold in Europe, rapidly depleting storage. By April, storage levels had fallen to just 28%, and although they have since recovered to 48%, this remains below normal. It may prove insufficient to ensure stable supplies next winter.

Market dynamics also play a role. After US and Israeli strikes on Iran in late February, European gas prices surged before partially stabilizing. However, relatively low prices in the European market make it less attractive for suppliers—for instance, US companies prefer to divert LNG cargoes to higher-paying regions.

Natasha Fielding, an expert at Argus Media, warns that any further disruptions in the global LNG market could lead to sharp price spikes during peak winter demand. Analysts emphasize that low storage levels and instability are a dangerous signal, potentially leading to serious energy security challenges.