A widening natural gas storage gap in Europe is capturing the attention of traders, who expect the world’s biggest exporters to begin jostling to refill fuel depots depleted by the continent’s harsh winter.
Gas storage is critical for blunting spikes in demand and smoothing price volatility during extreme weather and disruptions to supply. Europe’s cold winter left facilities about 25 billion cubic meters below last year’s levels -- a volume of fuel equivalent to nearly third of annual consumption in Germany, the region’s biggest user.
“The trend is clear,” according Niek van Kouteren, a senior trader at Dutch energy company PZEM NV. Suppliers from Moscow to Houston “will have room to take advantage of the momentum,” he said.
Booming summer demand will support shipments from Russia, Norway, Qatar and the U.S. Almost 60% more gas than last year will be needed to refill inventories after cooler March weather across Europe kept demand elevated. Filling the storage gap before next heating season is expected to benefit both pipeline exporters like Gazprom PJSC, as well as liquefied natural gas players such as Texas-based Cheniere Energy Inc.
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