FSUOGM: Gazprom stockpiling domestically

Russia’s Gazprom expects to finish stockpiling gas at its Russian storage sites on November 8, CEO Alexei Miller said on October 27, after which it will shift its focus to filling its sites elsewhere in Europe.

Miller was discussing the situation on the gas market in a meeting with Russian President Vladimir Putin. The two men noted that European gas storage utilisation was at an unusually low level for this time of year, and that Gazprom’s own storage sites on the continent contain only 190,000 cubic metres of gas.

However, Gazprom’s first priority is building up its domestic reserves. The company aims to have 72.6bn cubic metres of gas in place by November 8, Miller said.

“As soon as we finish pumping [gas] into the UGS in Russia, we will start pumping our Gazprom’s gas into European UGS,” Miller told Putin.

The Russian president said this would improve conditions on the European energy market, where gas and power prices have skyrocketed in recent months as a result of robust demand and supply constraints. He blamed the situation in Europe on cuts to indigenous gas production there, as well as lower LNG imports, especially from the US.

Putin insisted again that Gazprom was abiding by its long-term supply contracts, hitting back against accusations that the company is exacerbating the energy crisis by keeping back some supply.

Expectations are that European gas prices will remain high into early next year, especially if the coming winter proves to be a cold one. While global LNG supply is on the rise, the commodity continues to trade at a premium in Asia, driving supplies away from the European market.

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