There is hardly anything that motivates one to achieve a goal more than the internal need for it backed by objective circumstances. Targets set externally are naturally becoming less efficient as soon as the reality for which they were created has undergone a change.
No, this is not an extract from some speech by a business coach – it directly relates to the ongoing injection season in Europe.
Speaking of Central European nations with all their derogations and exclusions, there are two things to bear in mind when forming an idea of what 2025 gas summer would look like for them.
First, it is the ratio between demand across the region during winter and technical capacity of underground storages they have.
In most CEE countries the ratio stands at nearly 1:1, with the Czech Republic’s Q3-Q4 average consumption exceeding storage capacity by around 20% (which explains a 90% storage filling target at the national level).
The ratio for Italy’s winter demand vs storage capacity is 2:1 so why this is a problem for Central Europe, you will ask?
The answer to it would bring you straight to the second factor which is their geographical location.
While Italy, or Germany, or Netherlands, or France has quite a few supply routes, those in Central Europe are landlocked and thus are limited in the number of options available to them.
With cross-border bottlenecks all across the region, they are particularly reliant on storage.
Here, Hungary stands apart from others due to regular Russian supplies through the Turkish Stream corridor.
Though even that does not free the country from the necessity of allocating part of its storage space towards strategic reserve.
The potential price of not being prepared properly for the winter is high in Central Europe, both literally and figuratively.
And in the post-Russia/Ukraine transit reality, the price to pay for a mistake in preparation for the upcoming winter has just increased.
If globally, macro and demand as a function of it are in the spotlight of everyone, at a European level the west-to-east flow is among the topics to watch.
Add Ukraine to a wider CEE’s injection demand, and the story becomes no less interesting to track than Ovechkin’s NHL goal record chase in the last half a year.
Source: Yakov GRABOR
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