EU now he probably saved up enough natural gas to survive the winter without the need for industry to limit consumption. If natural gas imports from third countries, rather than Russia, remain at recent high levels, and companies and households continue to respond to high prices by reducing consumption, the EU is likely to avoid immediate shortages and cuts both this and next winter. , even if all imports from Russia stop from November.
On current trends, natural gas storage is likely to be 95% full by the end of October, before the cold weather sets in. Some evidence suggests that natural gas consumption in the EU has already fallen 10% below the 2017-2021 average. For our base case, we assume that the temperature will remain at the level of the average value over the past five years, and by September 2023, the savings will reach 15%. Reducing the demand for gas is crucial. In our base case scenarios, imports from sources other than Russia remain at elevated estimated recent levels (May to October 2022) and then increase by 1% every three months from January 2023. Domestic production remains unchanged.
There are, of course, alternative scenarios, such as taking into account the effects of a colder winter and no further increase in non-Russian imports in 2023 is a negative outcome. On the other hand, we are also seeing the largest reduction in gas consumption. These scenarios do not indicate a clear shortage of natural gas. However, the risks remain: serious disruptions in gas supplies from non-Russian sources or an unexpected increase in gas consumption could bring back to the discussion the risk of having to ration gas by decree, not just by honor. The gas supply situation now looks less dangerous than a few months ago. Estimated natural gas prices have also fallen significantly since their spike at the end of August. While we continue to forecast a severe recession in the Eurozone this winter, the fall in output from a record low could now be -1.7%, less deep than the -2% we previously expected.
* Mr. Salomon Fiedler is an economist at Berenberg Bank.
Source: Kathimerini
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