Europe's First Cold Snap Begins This Week Amid Worsening Energy Crisis

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by Tyler Durden
Monday, Sep 26, 2022 - 06:45 AM

Europe is plagued with an energy crisis, and the cold season is coming ahead of schedule. 

The stability of the EU's natural gas reserves now depends on a mild winter. But new weather forecasts for next week indicate that "Arctic chill will blow across western Europe through next week will be the first test of how willing people are to delay switching on the heating in a bid to save energy and ease household budgets," according to Bloomberg

Forecaster Maxar WeatherDesk said temperatures in London would sink 5 degrees Celsius below average, falling as low as 6.5 degrees Celsius overnight on Sept. 27. In Frankfurt, Germany, temperatures will fall 3.5 degrees Celsius below normal levels on the 28th, while France and Spain will see temperatures 3-4 degrees lower than the seasonal norm. 

"It will turn even colder early next week as a plunge of Arctic air surges southwards, and a strong northerly wind will accentuate the chilly feel," according to the UK's Met Office.

Germany, France, and Spain have approved energy conservation measures to decrease demand for NatGas, while the EU as a whole has reached the 80% target (now 86.9%) of filling storage tanks by Oct. 1. 

According to Aurora Energy Research, full NatGas storage could sustain EU countries for at least three months this winter. In Germany, the bloc's largest economy and home to a quarter of EU storage, there are about 80-90 days of fuel in storage. 

But with a squeeze on regional supplies exacerbated by Western sanctions against Russia that have backfired, plus Russian energy giant Gazprom's shuttering of Nord Stream 1 to Europe -- the stability of Europe's NatGas reserves depends on a relatively mild winter because if it gets cold enough, demand will soar and draw on reserves faster, catapulting NatGas prices even higher.  

The blast of cold air next week is troublesome because the EU heating season doesn't begin until the first half of October. 

Continuing to reduce Natgas demand is what European countries need to do because the latest National Grid Plc data show early morning UK fuel demand is already increasing. There needs to be a more significant conservation effort ahead of the colder months or face a very dark and expensive winter. 

One would think Europeans wish for global warming this winter to starve off the rapid drawdown on NatGas reserves as the crippling energy crisis could extend well into 2023. This isn't a one-winter story.