The Christmas Miracle: Gas Storage Scenario Update 02.01.23

The frigid start to December that caused gas stores to be emptied rapidly has been replaced by warmer weather, leading to the most optimistic scenario yet.

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Since the last update, Germany and much of Europe was hit by a big freeze that caused the gas stores to be rapidly emptied. Over the holiday period this was replaced by unusually warm weather, during New Year some areas of Germany experienced temperatures up to 20°C above the norm. This weather combined with the lower activity during the holiday season has allowed Germany to replenish its gas stores again. After bottoming out at 87.20% full on December 20th, gas stores have now been filled back up to 90.64% as of January 2nd.

Looking back at my earlier predictions from November 14th, the current gas storage is above even my optimistic scenario. The extremely low temperatures in start-mid December caused a sharp decline, but the following mild weather has averaged it out to a point very close to the “Optimistic scenario”. Currently there are no more periods this winter which are forecast to me much colder than average, which means that gas stores may well continue to remain above the “Optimistic Scenario” from November 14th.

For the latest update to the scenarios, there has only been very minor changes in export and import values. These include adding the LNG being directly imported to Germany through the new Wilhelmshaven LNG Terminal which has just begun operations, receiving its first full shipment from the US today.

As the gas storage fill level is now above the “Optimistic Scenario” from November 14th update, forecast gas levels are continuing to look better than they did almost 2 months ago. This very positive development has had the greatest impact on the worse case scenario where Germany continued to use gas in line with pre-crisis levels. Previously, had Germany continued its normal average gas consumption over the winter without any reductions from November 14th, gas levels would currently be at 73.28% instead of 90.64%. This massive improvement means that the worst case scenario of “no reduction in gas usage” has gone from a bottom of 23.5% in mid April to 38.14% in mid April. The continued filling of stores due to warmer than average weather during November have allowed for even this scenario to remain well above the 2018-2021 minimum fill levels. Amazingly, this worst case scenario now estimated to have a fill level of 70% on February 1st, the date where the mandated goal was a mere 40% fill level.

All other scenarios with some gas usage reductions mange to keep Germany at a very high level throughout the winter.

The gas situation in Germany has improved to a point where not only is it hard to image a scenario where Germany runs out of gas this winter without a serious reduction in imports, presumably through the sabotage of gas infrastructure. It is also hard to image a scenario where Germany even drops to the same levels as 2021 during the winter. At this point it appears that Germany may also end up in a good position going into winter 2023.

The “Optimistic scenario” has attempted adjust for the temperature related gas savings. With this adjustment, German households and businesses have saved around 22% gas compared to the 4 year average. At the same time German industry, which is less affected by weather and has a more stable gas consumption, has saved around 18%. For the optimistic scenario I have accounted for this, with a decrease in savings to 10% for households and 5% for industry from the beginning of April as the winter and immediate danger passes.

Barring any major crisis (import issues, sabotage, unusually cold weather) I continue to estimate that we will see a scenario between the blue and green dashed lines on the scenario graph. With the current forecasts for weather and gas usage, I don’t find it unrealistic that the actual use may beat even the “Optimistic Scenario”. This would mean a bottom in gas stores at around 67% full in mid April. The current weather may allow Germany to continue filling gas stores instead of withdrawing from them for another week or more.

Additional information on my scenarios can be read here

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