European gas storage injections delayed as demand rises

European gas storage injections have been delayed in early April, as higher demand and shifting regional flows slow the start of the refill season.

A small increase in European gas consumption between the end of March and the start of April, with demand returning above seasonal expectations for the first time since February, has delayed the start of European storage injections by a week or so.

European storage levels are likely to have reached their lowest for the year just below 28% of total capacity at the very start of April.

The start of injections is being supported by the almost complete stop in exports to Ukraine on 1st April.

This had been anticipated for a few weeks, as almost no capacity had been booked at EU-Ukraine border points, and it appears to be caused by a combination of the seasonal decline in demand in Ukraine itself and high market prices.

This has played an important role in enabling a swift turn to storage injections in Hungary, Slovakia and Poland over the weekend.

It remains unclear, though, what impact a significantly reduced rate of imports from the EU in the coming weeks or months will have on the Ukrainian market later in the year, as it may result in higher requirements in the second half of the year.

The Netherlands also saw a rapid turn from withdrawals to injections last week, likely to have been caused by levels of gas in storage falling below 5% of total capacity.

The start of small levels of injections was enabled by a rise in imports from Germany. This increase in German exports, in turn, has contributed to causing a pause in the early start of injections that Germany had seen in the last few weeks.

Source: Giovanni BETTINELLI