The European Union’s biggest gas inventories in three years are cushioning the region from Russian supply disruptions and helping avoid a repeat of previous crises when prices rose as much as fourfold.
OAO Gazprom (GAZP), Russia’s state-run gas company, cut supplies to Ukraine yesterday after a deadline for debt payment expired. The move echoed similar disputes that disrupted shipments to Europe during freezing weather in 2006 and 2009. Europe, dependent on Russian gas piped through Ukraine for about 15 percent of its needs, has tried since May 2 to broker a deal to maintain flows. European gas prices, which rallied the most since March yesterday, erased gains today.
Storage in the 28 member states was 65 percent full as of yesterday, the highest for this time of year since 2011, according to Brussels-based lobby group Gas Infrastructure Europe. U.K. prices, a regional benchmark, probably won’t gain more than 5.6 percent, assuming the cut lasts two weeks or less, Trevor Sikorski, an analyst at Energy Aspects Ltd., a consulting firm to the industry in London, said yesterday.
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