The European Commission on Monday proposed extending the emergency measure which targets a 15% reduction in the bloc's natural gas consumption by another 12 months to the end of the 2023/2024 winter heating season.
The existing regulation to have natural gas demand cut by 15% expires at the end of this month.
Today's proposal from the European Commission for another year of gas savings will be discussed by energy ministers at the Transport, Telecommunications and Energy Council (TTE) Council on March 28. EU Commissioner for Energy Kadri Simson already signaled to Ministers in February that a proposal along these lines was to be expected.
Despite the coming end to this winter's heating season and the historically high levels of gas in storage across Europe, global natural gas markets are expected to remain tight in the months ahead, with a number of possible risks and challenges, including weather, global LNG demand, and macroeconomic conditions, the European Commission said today.
"Commission analysis finds that, in order to fully compensate for the permanent decrease in Russian gas, a continuation of the gas demand reduction is needed to complement the additional LNG and pipeline gas sourced from other countries, and new renewable capacity installed since early 2022," it added.
The European Union managed to beat its target for cutting gas demand this winter, Eurostat data showed last month. According to the data, the EU's winter demand has so far dropped by 19.3% compared to the five-year average, beating the 15% goal it set for itself to help it survive the winter without gas shortages.
"Our joint efforts on #gasdemandreduction have been key to get through winter safely. But global gas markets are expected to remain tight & we must stay vigilant. Continued demand reduction will ensure our preparedness & allow us to reach more easily the 90% gas storage target," EU Commissioner Simson said on Twitter, commenting on the proposal for extending the target for reduction of gas demand.
By Michael Kern for Oilprice.com
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