The European Union urged member states to start filling gas storage facilities earlier “to avoid competition for supplies, which could cause prices to spike as early as summer”. The move is linked to risks to the energy market amid the war in Iran.
European Commissioner for Energy Dan Jorgensen in a letter to governments, which was read by Bloomberg, also proposed to reduce the target of filling gas storage facilities to 80% and maximise the use of flexible mechanisms provided by EU legislation.
According to the proposal, countries could deviate from this target by 10 percentage points, and a further 5 points in unfavourable market conditions. The deadline for fulfilling the obligation to fill the storage facilities is 1 December.
Jorgensen said that for the time being, security of gas supply remains “relatively stable” as the EU has limited dependence on imports from the conflict region. In addition, some liquefied natural gas had already travelled through the Strait of Hormuz before the situation escalated.
However, the EU, as a major importer of energy on global markets, could face the consequences in the form of high and volatile prices, which would affect the rate at which gas is pumped into storage.
Israel and the US have been striking Iran since 28 February. US President Donald Trump has said the purpose of this war is to destroy Iran’s military capability and prevent Tehran from developing nuclear weapons. Iran has been striking Israel and countries in the region that co-operate with the US.