The European Union has warned member states of a potential energy price crisis tied to the Middle East conflict and is urging governments to cut gas demand and keep filling storage before winter. EU Energy Commissioner Dan Jorgensen told energy ministers the bloc's reliance on imported fossil fuels has left it exposed to market turmoil.
The European Union has told member states to brace for a possible energy price crisis linked to the Middle East conflict, Bloomberg News reported Saturday. Brussels is urging governments to curb demand and keep filling gas storage ahead of winter.
Jorgensen warns of a supply-driven price shock
EU Energy Commissioner Dan Jorgensen wrote to energy ministers that the bloc's reliance on imported fossil fuels had exposed it to turmoil in energy markets, calling for urgent preparations before the heating season. According to Bloomberg: "We are facing a price crisis linking to a supply crisis", Jorgensen wrote.
European natural gas prices have more than doubled since the start of the U.S.-led war on Iran in late February, reaching their highest level since late 2022 earlier this month.
Storage falls short of the seasonal norm
EU gas storage facilities were just over 70% full, below the seasonal norm of 86%, as higher near-term prices made summer injections less economical, Bloomberg reported. Jorgensen reportedly said governments could use flexibility under EU gas-storage rules to lower the filling target to 80%, easing pressure on prices and refilling costs.
He also urged countries to sustain injections where needed and reduce gas and electricity demand for as long as necessary.
Source: Commodities & Futures News
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