Tom Haddon

Ok, what I probably meant was my pithy response to people who bring up Rough storage as some sort of critical asset or say the UK should be building a load more storage.

Doesn't the phrase "project power" there just mean, 'threaten to withhold energy exports'?

Might be an energy security point to reducing gas dependence if your key supplier tells you that they plan to exploit that relationship.

Yeh that's right. The smaller retailers were either excluded from hedging (for cost reasons) or chose not to to try and ride the day ahead/future spread (until they couldn't) - but still those suppliers formed a very small proportion of the gas market.

But the vast majority of retail is gas *is* bought as futures. The consumer is holding the bag if you want to think like that, but very few consumers want to be exposed to prompt prices so the cost of certainty is generally fine. All retailers do is hedge and bill.

Be careful. When gas is bought, the spreads are locked in, so it won't be coming out at prompt prices now, it will be coming out at whatever the futures were locked in at back in the summer (generally speaking).

You may well have some of your volume 'floating' to capture cold snaps though.

Final conclusion: gas storage is being structurally shoved to one side by LNG in Europe.

This is purely economics in action and the reason why the EU *had* to loosen storage targets (and will ultimately ditch them) because gas in storage has economic rules to follow, just like everything else.

The issues of national security are obvious though, so I wouldn't be surprised to see nationalisation of sites (like the Germans did with Gazprom's DE portfolio) to protect that.

But ultimately, maybe this will give a bit more food for thought when thinking about the role of gas storage in Europe.

This is a structural change, with the amount of LNG coming, why would you pay an expensive or cumbersome storage tariff if you could manage a portfolio of more diversified LNG?

So we may start to see the massive EU gas storage network as a (partially) stranded asset.

bsky.app/profile/tomh...

It turns out the Dutch have loads of storage, it just happens to be floating somewhere in the North Atlantic or in US shale formations.

LNG imports into Dutch terminals are ripping (graph C/O @bmvisser.bsky.social) as traders are exchanging expensive storage capacity contracts for LNG orders.

Dutch gas storage levels in 2025 and every year back to 2021. 2025 is considerably lower than most years.

This Autumn, Dutch storage never got above ~73% full. For bundle of infrastructure that is supposed to be underpinning gas networks across North Western Europe, that should be worrying, shouldn't it?

Not exactly, because traders have taken my UK joke and extended it across the Atlantic.

And that is because the huge facilities around the big ports in the Netherlands are designed to be storage for others to make use of (that's the joke that the UK has loads of storage, it's just happens to be elsewhere)..but now we get to my point.

Dutch storage is going unused...

So the above tells you broadly speaking storage could cover maybe a third consumption, let's look at a country level on that metric:

Germany: 28%
France: 34%
Italy: 30%
UK: 1% (doesn't include LNG should be closer to 10%)
Netherlands: 48%

The Dutch are miles ahead....

The background. The European continent boasts the biggest, most well developed & interconnected gas storage facilities anywhere. Some numbers:

Total storage: 1150 TWh (1400 TWh incl non-EU, i.e. Ukraine)
Total sites: ~110
Biggest site: Rehden (DE) ~44 TWh

EU consumption: ~3500 TWh

I am referencing here the role of gas storage. You will have spent the last four years, since Gazprom [Putin] started unilaterally draining East German mega storage sites, experiencing it being the lighting rod to point to structural stress, fear, worry etc. Some justified, some not.

This winter, the gas price is going to grab *all* the headlines, but there is something structural changing in Europe.

And the place to find this is; the Netherlands. That tiny country, populated by people who seem to all be 7ft tall and love beer and football even more than the UK, that one. 🧵

Brutal day, front month contracts about 4.5% down today alone.

Market 'rallied' by a fraction of a penny in the last three mins to close just north of 70p/th (70.07p).

We are moving towards price collapse territory now if we see another decent loss tomorrow.🤞

And not a minute too soon. I was losing the plot (which was clearly self evident via sequentially nested posts into infinity).

Good idea. Plus, wouldn't have to schedule it, she would know it was coming.

Oh, sorry Meg. Didn't realise.

Will just have to keep relying on Javier Blas, although his forecasts are even less scientific.

Number 1 rule in energy market data analysis: Nothing moves in straight lines.

Apart from European LNG import volumes from August onwards, that is.

Let me just ring Mystic Meg to figure out what happens in December.

How did those worries about next winter's gas turn out, Bloomberg?

When you base your stories on traders selling you their book, nonsense like this happens.

bsky.app/profile/tomh...

Well I waited ages for European gas price volatility, and it's certainly here now. Another selling session on the cards today, with a test of 70p/th potentially coming up (!!!). For context, this is ~20% down on last month, and 35% down y-o-y.

Out there, fundamentals remain weak.

If there is a warm, wet and windy winter across Europe (long range models are inching that way), there is going to be fireworks.

Been plenty of chatter today about the HH-TTF spread closing up and the conditions Venture Global (Plaquemines LNG) was touting at IPO....let's just say, they are not out turning to expectations.

(Share price lost >70% of value since float).

God knows the British love a war effort. We would have had 'patriotic' tradesman going from house to house to lower gas use under a Government programme.

But we had a minister at first claiming the price cap was protection, and then Liz Truss' uncapped energy support, with only debt to show for it

I adore the term 'National Insulation Offensive'.

I fully believe that if, at the time Gazprom was draining storage and gas prices were on route to spiking >1000%, the PM at the time said something like 'we're under economic attack' the policy options could have been galvanised like this.

There is a whole litany of funny things going on with the DREAM (RED) TEAM (copyright Claire Coutinho):

Exhibit A: Kathryn Porter's IRR analysis went so wrong she got into Private Eye

Exhibit B: Steve Loftus (whoever that is) got caught lying and had to publicly grovel.

Just re-floating this as it is fun.

One of the former-Energy SoS's 'red team' members has no idea what the price cap is actually doing in Jan (gas unit prices falling by 6% in Jan, vs last cap).

Oh and actually, the prices *now* have literally no effect on the cap in Jan (it will effect April).

Maybe you missed the context, read it again with this in mind:

We don't, that's the thread, it breaks down the abundance argument to it's logical conclusion.