Key facts
- Europe has less than four months to fill its gas storage facilities before winter.
- Current EU gas storage levels are at approximately one-third of total capacity, significantly below targets.
- The market mechanism for filling reserves has weakened due to a diminished price gap between summer and winter gas.
- The closure of the Strait of Hormuz has reduced Europe's LNG supply.
- Ukraine has a history of using non-market tools and mandatory insurance stocks for gas security.
- Germany is considering a proposal for a strategic gas reserve financed outside the market.
Europe faces a critical challenge in refilling its natural gas storage facilities before winter, with only about four months remaining until November 1. Current storage levels are significantly below targets and last year's figures, raising concerns about energy security. The traditional market-driven approach to filling reserves, where traders profit from price gaps between summer and winter, has become less effective this year due to a vanishing price spread. This situation is exacerbated by the closure of the Strait of Hormuz, which has reduced Europe's access to Qatari and Emirati LNG, resulting in a substantial loss of monthly supply.
Analysts predict that the European Union may only reach around 70% of its storage capacity by November 1, falling short of its own 90% target and representing the thinnest winter cushion since the 2022 crisis. Ukraine, which has long treated gas reserves as a security obligation rather than a market option, offers a precedent. Since 2016, Ukraine has required suppliers to hold insurance stocks and has managed its own extensive storage system through three winters of war, even under attack.
Germany's grid operators, FNB Gas, have proposed a "combination model" that includes a year-round strategic reserve and a supplier filling obligation, financed outside the market. This mirrors Ukraine's experience and the existing practices in countries like Austria and Hungary, which maintain dedicated gas reserves. The European Commission is expected to introduce new legislation on security of supply in the second quarter of 2026, with proposals likely to emphasize treating strategic reserves as insurance premiums, building them on a European scale for solidarity, and utilizing existing capacity, including Ukraine's substantial storage offerings.