Europe faces winter with weakest gas buffer in 15 years
Europe will enter the heating season with a critically thin gas supply buffer after geopolitical disruptions redirect vital LNG cargoes to higher-paying Asian buyers.
Europe is on track to enter winter with its smallest natural gas supply buffer in 15 years. Equinor CEO Anders Opedal warned on Wednesday that storage facilities are highly unlikely to reach even 80% capacity before the heating season begins. Sites are currently only about 54% full, marking the second-lowest level for this time of year since 2010 and sitting well below the five-year average.
The shortfall stems from a sudden redirection of liquefied natural gas (LNG) supplies toward Asian markets. Disrupted shipments through the Strait of Hormuz following the U.S.-Iran war have tightened global availability. European utilities are losing out on spot cargoes to Asian buyers scrambling for replacement volumes. Japan’s wholesale electricity prices have surged to a three-and-a-half-year high, Pakistan is paying record prices for spot LNG, and India is accelerating long-term contracting.
The shift is clearly visible in global shipment tracking. Kpler estimates Asian LNG imports will climb to a six-month high in July, driven primarily by a sharp recovery in Chinese demand. Conversely, European LNG imports are projected to fall to their lowest level since September 2024. U.S. cargoes that would typically replenish European storage are increasingly sailing east, pulled by higher prices.
This creates an acute structural problem for European energy security. LNG accounts for roughly 30% of the continent's gas imports, leaving its refill campaign heavily exposed to international competition. The EU energy regulator ACER noted earlier this month that inventories started the summer injection season at just 28%, significantly depleted by a cold winter, leaving minimal room for error.
For markets, the implications point to renewed price volatility as winter approaches. Norway supplies about one-third of Europe's gas imports, giving Equinor an unusually clear view of the continent's supply strain. The inability to rebuild inventories forces European utilities to compete for expensive spot cargoes rather than relying on stored buffer stocks, a dynamic that will likely pressure utility margins and test industrial demand in the months ahead.
