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"Gazprom is turning into a company with moderate profits"

19 July 2022

Belogoryev Alexey M. Research and Development Director, Director of the Center for Energy strategic analysis and forecasting

Alexey Belogoryev, Deputy Principal Director on Energy Studies of the Institute for Energy and Finance, gave an interview to Novye Izvestiya about the problems and prospects of Russian natural gas exports.

Data on hectic gas reserves in European countries are updated daily. At the moment, how much are the storages in the eurozone filled with?

-The volume of gas reserves in underground gas storage facilities in the EU as of July 17 is, on average, 64.4%. In many countries they are higher. In Germany already 65%. The worst situation remains in the countries of Eastern and Central Europe: in Bulgaria, Croatia, Hungary, Latvia and Austria they are still below 50%. In general, stocks are replenished much more actin than last year. And if there are no problems with current supplies, then the reserves will be brought up to 80-85%, and under favorable conditions even up to 90% by the end of October.

How many months will this be enough for Europeans? And in what autumn-winter month will all the most interesting things begin for them?

-Gas reserves cannot be enough to cover the entire winter demand. Their selection must be combined with large and stable import supplies. Reserves are needed, first of all, on the coldest winter days, when gas pipelines simply do not have time to deliver due to technical limitations. In addition, they play an important economic role, making it possible to equalize the seasonal fluctuations in demand and make it possible for gas companies to earn on the seasonal fluctuations in prices. Gas prices in Europe tend to be much higher in winter than in summer.

How is Europe going to survive the winter then?

-It’s difficult. As recently as July 18, Fatih Birol (Executive Director of the International Energy Agency - ed.) published a detailed commentary on this topic, in a very gloomy tone. There are serious concerns, but there is no one ready-made solution. In order to replace Russian gas, a whole range of measures is needed. Some measures are already being taken, others are just outlined, but there is little movement.

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