Bloomberg: Europe to face winter reckoning amid LNG competition

A global scramble for liquefied natural gas (LNG) is threatening Europe’s strategy of delaying major purchases until shipping through the Strait of Hormuz resumes, Bloomberg reports.

European governments and energy companies entered the spring with gas storage levels at their lowest since 2022 but postponed large-scale purchases, hoping that prices would fall after tensions in the Middle East eased and LNG flows through the strait resumed.

However, renewed fighting has pushed gas prices higher, while Asian countries have begun competing more aggressively for available LNG cargoes.

Europe has continued gradually replenishing underground gas storage facilities, but the region could face a “moment of reckoning” ahead of the winter heating season as instability in the Middle East and growing competition for limited supplies increase prices.

The European Union is likely to be able to rebuild its gas reserves to the required levels, Bloomberg reported, but may have to pay significantly more, increasing costs for households and industry.

European governments could also intervene directly in gas procurement, a move that would further intensify competition in the global LNG market. 

By Sabina Mammadli