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Total gas demand in Europe was down across the major markets in July and August. In the UK, it was down 1.5 bcm (-15%) y/y on hotter than normal temperatures. The north-west European gas markets of Belgium, France and the Netherlands all went through the July and August summer months with lower gas demand than last year, thanks mostly to an August that was very average in terms of its temperatures. German consumption was down in July, and all months this year have been down y/y except for that very cold March. Over the first seven months, implied German demand appears to be down 1.1 bcm (-2%). The Southern European gas markets of Spain and Italy both went through the July and August period dropping end-user gas demand. For Spain, this is mostly due to the very good hydro generation levels recorded so far this year which are set to continue. For Italy, all of the solar generation that has been installed over the last two years (13 GW) is starting to take its toll on gas plant that previously thrived on meeting summer peaks.
While demand was down, the need to fill storage facilities was large and the market responded with much higher injection levels. Over the two months, the markets experienced around 5 bcm more y/y being injected into European storage facilities
European markets balanced with a mixed pattern for imports. Norwegian exports were broadly down (to the UK and Germany), as were exports from Algeria (down in Italy, up in Spain but a net reduction). Russian imports, however, were up with Germany and Italy with both taking more to help fill their storage facilities. LNG imports were down across the board with all markets seeing a y/y loss in import volumes.
