Key Moments
- Commerzbank’s Norman Liebke links European gas storage levels over winter directly to the pace of LNG import inflows.
- At the current LNG inflow rate of 8 bcm per month, gas storage is projected to trend toward 0% by March.
- Upside risks to both European gas and electricity prices are highlighted amid strong Asian LNG demand and missing Qatari LNG volumes.
LNG Inflows Seen as Determinant of Storage Levels
Norman Liebke of Commerzbank assesses that the trajectory of European gas storage will hinge on an increase in liquefied natural gas (LNG) imports over the winter period. He notes that current LNG inflows of 8 bcm per month would lead to a pronounced drawdown, with storage levels trending toward 0% by March.
Against this backdrop, Liebke evaluates different LNG import scenarios and their implications for storage, underlining the importance of higher inflow volumes to avoid a severe depletion of stocks.
Storage Outcomes Under Different LNG Import Scenarios
Liebke outlines potential outcomes for European gas storage under varying monthly LNG inflow assumptions, highlighting how sensitive the system is to changes in import levels.
| Monthly LNG inflow scenario | Estimated storage outcome | Commentary |
|---|---|---|
| 8 bcm per month | Trend toward 0% by March | Implies a substantial risk of storage exhaustion by the end of the winter period. |
| 10 bcm per month | About 16% shortly before the start of the replenishment phase | Described as a middle-ground scenario and regarded by Liebke as quite realistic. |
| 12 bcm per month | Not quantified in detail | Considered somewhat too high given the competition from Asian buyers for US LNG. |
Detailed Scenario Commentary
One scenario considered is that the current LNG inflow rate remains unchanged. Liebke states: “If this level were maintained through spring, gas storage levels would reach just around 70% in October and head toward 0% by March.”
He identifies an intermediate case, explaining: “A middle ground would be 10 bcm, which would leave gas storage levels at about 16% shortly before the start of the replenishment phase.”
On the likelihood of higher inflows, Liebke says: “We consider 10 bcm to be quite realistic, while 12 bcm seems somewhat too high, as demand for US LNG from Asian countries is likely to remain high even if the Strait of Hormuz remains open on a sustained basis.”
Price Risks for Gas and Power
The analysis also emphasizes the impact of constrained LNG availability on price dynamics. Liebke warns that a delayed recovery in imports, robust LNG demand from Asia, and missing Qatari LNG volumes are contributing to upside risks for European gas markets.
He notes: “This increases the pressure to import even more in the coming months, thereby raising the price risk.” According to Liebke, the implications extend beyond gas, as he adds: “Ultimately, this would also further increase upward pressure on European electricity prices.”
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