EU to Open Third Round of Joint Gas Buying in September
(Reuters) — The European Union will open its third round of joint gas buying next month, as the bloc moves to secure supplies in preparation for another winter with scarce Russian gas.
The EU started collectively buying gas this year, as part of its response to Russia slashing gas deliveries in 2022 following its invasion of Ukraine.
European gas buyers can place their requests to buy volumes from Sept. 21, for deliveries from November 2023 to March 2025, gas capacity platform Prisma, which hosts the EU buying platform, said on Wednesday.
The scheme gathers demand from companies, then seeks offers from global gas suppliers, and matches buyers and sellers. The EU is not involved in the commercial negotiations that follow between the companies to sign contracts.
The joint buying scheme does not purchase Russian gas.
Brussels conceived the program to help fill storage caverns ahead of winter and combine EU countries' market clout, rather than have them competing against one another in global markets — which could drive up gas prices.
Despite initial skepticism from some industry sources over whether companies would use the scheme, the EU looks set to comfortably exceed its goal to jointly buy around 13.5 billion cubic meters of fuel.
A second EU tender in July saw companies place requests to jointly buy 16 Bcm of gas, after a first tender in May sought another 11.6 Bcm.
Those volumes are a sliver of the EU's total demand of around 360 Bcm but aim to help countries prepare for winter when Europe's gas demand for heating peaks.
Europe's gas storage is already unusually full for this time of year, thanks to relatively low gas prices and last year's mild winter which saw gas use drop - but analysts warn prices could rise, for example, if a potential strike at liquefied natural gas facilities in Australia disrupted global supply.
The EU's underground gas storage capacity — which totals around 100 Bcm — is currently 91% full, Gas Infrastructure Europe data show.
Related News
Related News
- FERC Approves TC Energy's 1,377-Mile West Coast Pipeline Expansion
- Kinder Morgan to Buy NextEra’s 462-Mile Texas Pipeline System for $1.8 Billion
- Williams' Gas Pipeline in Idaho Ruptures, Company Challenges Explosion Allegations
- Biden Awards $7 Billion in Hydrogen Hub Money to 16 States
- Mountain Valley Pipeline Sues Protesters Hindering $7.2 Billion Construction Project
Comments