Europe's total gas win

How a continent painted itself into a corner and the only way out is through a recession

On November 18, 2022, Reuters’ market analyst John Kemp reported that Europe’s gas storage likely peaked in mid-November after a record refill season, most of it made possible by record imports of U.S. liquefied natural gas.

EU politicians celebrated this record refill season with proclamations that Russia’s weaponisation of energy had failed and Europeans could safely head into winter because there was enough gas. Well, as long as they used less of it, of course.

Yet the message, loud and clear, was that Europe had won — it could do without Russian gas. The same message has been echoed again and again in the months since then, with Germany particularly proud that it had successfully reduced its dependence on Russian gas from a lot to zero.

Now, I know you remember this but I also know that scientists have found a causal relationship between excessive internet use and memory as well as other cognitive functions. And I know that with large media incessantly reporting on Europe’s huge gas success might have made people forget certain details. Such as the price tag of that victory.

Argus sounded the alarm in January with a report about Germany’s gas market operator, Trading Hub Europe or THE for short. The report said that THE had bought and stored some 50 TWh worth of gas last year. On the spot market. During a time when prices on that spot market were running into ever-higher three-digit figures to hit a record of over 300 euro per MWh. And then prices dropped like a stone.