UGS occupancy in Europe remains at a minimum level – about 74%
Production capacity cannot be increased by magic, said Russian Deputy Prime Minister Alexander Novak.
High prices for natural gas in Europe are not due to a shortage of its supply, but to a low level of storage capacity. This was stated by the Deputy Prime Minister of the Russian Federation Alexander Novak in an interview. Business FM, unveiled on Friday 15 October.
“Today the European market is fully provided with gas, because the supply of imports in general, plus our own production, ensure the internal consumption of the European market. At the same time, even partially gas is pumped into underground gas storage facilities, that is, there is no gas shortage,” Novak said in within the framework of the Russian Energy Week.
According to him, there is a problem related to the fact that in the past five years the occupancy of storage facilities has remained at a minimum level – about 74%, while it is usually higher – 85-90%.
“This, of course, raises concerns among market participants, there are risks, as a result, as usual, the market reacts, prices rise,” Novak said.
He stressed that Gazprom will increase production capacity if European partners increase the volume of long-term contracts. But, added the Deputy Prime Minister, production capacity cannot be increased “by magic” – this requires investment.
“We are fully fulfilling our obligations under all contracts between Gazprom and the buyers of Russian gas, and this is confirmed by our European partners,” Novak said.
It was previously reported that Gazprom’s production peaks in 13 years… In September, the monopolist produced 40.8 billion cubic meters of gas, which is 12% more than in the same period last year. This figure is the highest since 2008, when it exceeded 42 billion cubic meters.
It also became known that Gazprom has increased its estimate of the average price of gas exports to non-CIS countries in 2021 – up to $ 295-330 per thousand cubic meters.
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