Unusually cold weather boosted European gas demand last month, supporting strong pipeline supply and stockdraws. Higher Russian pipeline supply and a rare y/y increase in Dutch production helped offset a small drop in Norwegian supply and lower LNG sendout. Europe began the gas summer with 17.5 bcm in storage, a significant 8.9 bcm less y/y.
- Aggregate UK consumption was up by 1.7 bcm (24%) y/y at 8.9 bcm. LDZ demand totalled 6.8 bcm, up by 1.8 bcm (35%) y/y. Power sector gas demand inched down by 20 mcm y/y to 1.7 bcm, as higher aggregate power generation was met with a rise in generation from coal and wind. A tight supply-demand balance widened the NBP-TTF prompt basis and supported stronger y/y continental flows into the UK, which helped offset a 0.3 bcm (38%) drop in LNG sendout.
- Higher y/y gas demand in Belgium, France and the Netherlands widened the y/y storage gap in those three countries to 3.5 bcm by end-March, from 1.6 bcm at the start of March. Rising res-com demand was again the driver, with power sector gas demand dropping due to higher nuclear and hydro generation. Dutch production rose by 0.14 bcm (4%) y/y to 4.1 bcm, the first y/y rise for a month since 2016. LNG sendout across the region was broadly flat y/y as higher Dutch sendout offset a drop in French and Belgian regasification. High demand in Northeast Asia continued to draw cargoes which might otherwise have gone to European terminals.
- Net supply into Germany was 6.9 bcm last month, down by a small 0.1 bcm (2%) y/y. Very strong Russian imports (+0.96 bcm, 27% y/y) helped offset a 0.12 bcm (8%) fall in Norwegian takes. Gas-fired power generation fell by a chunky 1 TWh (4%) y/y to 4 TWh, as coal-fired output rose by 1 TWh y/y to 21 TWh. German stocks finished the gas winter at just 3.6 bcm, 3.4 bcm lower y/y.
- Cold weather drove a 0.3 bcm (10%) y/y increase in total Spanish gas demand to 2.8 bcm as non-power consumption rose by 0.3 bcm (12%) y/y. Heavy precipitation during the month closed the y/y gap in hydro reservoir levels, indeed they are now 21% higher y/y. Gas-fired generation fell as both hydro and wind generation increased. Hydro generation rose by 49% y/y to 4.4 TWh, while wind generation increased by 64% y/y to 7.7 TWh. Power sector gas burn fell by 2% y/y to 0.29 bcm. Pipeline imports were up by 0.40 bcm (32%) as Algerian imports increased by 17% y/y to 1.57 bcm. LNG sendout was down by 0.19 bcm (16%) y/y to 1.0 bcm.
- Total Italian gas demand was 1.74 bcm (27%) higher y/y owing to a 1.67 bcm (51%) rise in res-com demand. Higher Slovakian takes of Russian gas supported a 1.1 bcm (73%) y/y increase in exports from Austria into Italy. Storage draws rose by 0.84 bcm y/y to 1.36 bcm, while LNG sendout grew by 0.19 bcm (35%) y/y. According to Kpler data, LNG takes increased by 0.29 bcm (60%) y/y.
|European consumption and end-user supply, bcm|
Source: Country SOs, GIE, Energy Aspects