German gas reserves depleting during winter months as Gazprom reduces deliveries
Germany's natural gas reserves are noticeably low in the frigid month of February mainly as a result of Russian gas giant Gazprom’s throttled deliveries via Ukraine, Stefan Schultz writes in Der Spiegel. Since the beginning of January, the state-owned company Gazprom has throttled its gas deliveries to Europe via Ukraine. Germany’s economy ministry, however, said there had been "no indications" that delivery agreements between Gazprom and the Ukrainian gas network operator were not being complied with, noting that a total of 40 billion cubic metres had been agreed on for the current year. The country’s storage facilities in salt caverns, aquifers and pore storage caverns are currently only around 41 percent full, according to figures published by gas sector service provider AGSI. That’s a very low figure, says Eugen Weinberg, a raw materials analyst with Commerzbank, but adds that the situation is not critical and supply is secure. However, purchase prices on the gas exchange could rise in view of the current cold spell. With the heating season due to last until the end of March, more gas will be needed.
Simon Schulte, a gas market expert from the Institute of Energy Economics at the University of Cologne (EWI), said that Germany is well embedded in Europe’s internal gas market and that if necessary, it could simply import more. Speculating about Gazprom's reasons to reduce deliveries, Green Party parliamentary deputy Oliver Krischer said: “It may be that Gazprom wants to reduce the supply and thus drive up the price. But it may also be that additional pressure is being increased for the completion of Nord Stream 2." Krischer also called for setting up a state gas reserve in addition to commercial facilities in order to prevent bottlenecks and unwanted price hikes.
Natural gas currently covers a quarter of German primary energy consumption, second only to the country’s most important energy source, mineral oil. Most gas is used for heating and cooling in households and public buildings and for process heat in industry. Some is used to generate electricity and in combined heat-and-power facilities (CHP), and some for non-energetic use in industry. Current use in transport is marginal. While facing pressure from the U.S. to halt the German-Russian Nord Stream 2 project, the German government continues to support the endeavor.