Measures to combat COVID-19 have seriously affected the European Union’s gas market. In the second quarter, gas consumption in the region fell by 10% over the same period last year. This is stated in the gas market report for the second quarter of 2020 prepared by the DG Energy.
Highlights of the report
- In the second quarter of 2020 EU gas consumption decreased by 10% (8 bcm) compared to Q2 2019, mainly impacted by falling gas demand in industry, decreasing gas use in power generation, and lower injection needs in gas storages. Gas consumption in Q2 2020 was 71 bcm in the EU.
- Indigenous gas production in the EU, amounting to 15 bcm in Q2 2020, was down by 14% (2.5 bcm) compared to Q2 2019. In Q2 2020 the Netherlands produced 6.8 bcm of gas, Romania – 2 bcm, followed by Germany (1.3 bcm) and Italy (1 bcm). In the first half of 2020, gas production in the EU amounted to 30.5 bcm, down from 37.7 bcm in the first half of 2019.
- EU net gas imports fell by 14% year-on-year (14 bcm) in Q2 2020. Russian pipeline supplies covered 42% of extra-EU net gas imports. LNG imports together covered 25% of the total EU imports. Norwegian pipeline gas was only the third biggest import source (23%), followed by pipeline imports from North Africa (5%).
- Nord Stream remained the most important supply route of Russian pipeline gas to the EU in Q1 2020, as the amount of gas through the Ukrainian transit was still down by 47% in year-on-year comparison. The share of the Nord Stream reached 42% (14 bcm transit), the Ukrainian transit came to the second place, with 32% (11 bcm), followed by the Belarus route (23% – 8 bcm), and TurkStream had a share of 3% (1bcm) within the Russian pipeline gas imports.
- Gas storage levels in the EU stood at 80% at the end of June 2020, which was the highest in the last nine years at this time of the year. A filling rate of 80% on EU average is more typical at the end of August, not at the end of June.
- EU LNG imports decreased by 3% year-on-year in Q2 2020, after the dynamic growth in the recent quarters.
- Spot prices on the European gas hubs extended their falls of the previous quarter, and were down by 50-60% year on-year in Q2 2020.