The European Union's energy chief has told member states to start filling gas storage early in order to avoid competition for supplies that could cause a spike in prices over the summer, as the bloc seeks to mitigate the fallout from the Iran war.
Governments should also lower their gas storage filling targets to 80% and make the most of the flexibilities offered by EU law, the EU's Energy Commissioner Dan Jorgensen wrote in a letter, seen by Bloomberg News. Countries can deviate from that 80% goal by 10 percentage points, with a further five percentage point deviation available in unfavorable market conditions. Countries have until Dec. 1 to meet their gas storage obligations.
“Security of supply remains relatively protected at this stage due to the limited reliance on imports from this region and LNG cargoes that passed the strait of Hormuz before the conflict,” Jorgensen said in the letter to member states. “But, as a net energy importer on global markets, the resulting high and volatile global prices may also impact the EU gas storage injections.”
The letter, which was reported earlier by the Financial Times, comes after the latest attacks by Iran on Qatar's LNG production, with repairs expected to take up to five years. While the EU gets a relatively small share of its gas from the Middle East, it faces increased competition in the global market and prices in Europe have surged.
ALSO READ: US-Israel-Iran War News Live: US Says It Took Out Iran's Facilities 'Threatening' Hormuz Strait
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