• 4 minutes Energy Armageddon
  • 6 minutes How Far Have We Really Gotten With Alternative Energy
  • 10 minutes Russia Says Europe Will Struggle To Replace Its Oil Products
  • 3 mins GREEN NEW DEAL = BLIZZARD OF LIES
  • 2 hours Reality catching up with EV forecasts
  • 2 hours A Somewhat Realistic View of the Near Future for Electric Vehicles Worldwide
  • 14 hours "Natural Gas Price Fundamental Daily Forecast – Grinding Toward Summer Highs Despite Huge Short Interest" by James Hyerczyk & REUTERS on NatGas
  • 10 days US Oil Independence is a myth and will always be a myth
  • 6 days The Federal Reserve and Money...Aspects which are not widely known
  • 11 days Oil Stocks, Market Direction, Bitcoin, Minerals, Gold, Silver - Technical Trading <--- Chris Vermeulen & Gareth Soloway weigh in
  • 15 days Natural gas price to spike when USA is out of the market
  • 14 days "Biden Is Running U.S. Energy Security Into The Ground" by Irina Slav
  • 14 days *****5 STARS - "The Markets are Rigged" by The Corbett Report

Breaking News:

Freeport LNG Gets Regulatory Approval

Why Gasoline Prices Are Rising Today

Why Gasoline Prices Are Rising Today

U.S. oil refining margins soared…

Europe’s Energy Crisis Worsens As Wind Stops Blowing

Energy prices in Europe have hit records due to a shortage of natural gas and much lower than expected wind power output, the Wall Street Journal has reported. Some countries have even been forced to restart coal power plants to ensure enough electricity reaches consumers.

The UK is suffering the most from the drop in wind power output, caused by mild weather. The country, which prides itself on its wind capacity and whose Prime Minister last year said wind farms could power every home by 2030, produced less than 1 GW of wind power on several days. This compares with a generation capacity of 24 GW, according to ICIS senior energy economist Stefan Konstantinov.

Gas prices, meanwhile, are running at record highs because of the asynchrony in demand—spurred by the reopening of EU economies after lockdowns—and supply, which has been constrained because the EU is not the only region where economies are reopening after lockdowns.

ADVERTISEMENT

Insider reported that wholesale gas prices in Europe had surged by as much as 450 percent over the past year, causing electricity prices in Germany and France to hit records, too.

“It took a lot of people by surprise,” ICIS’ Konstantinov told the Wall Street Journal about the gas crunch. “If this were to happen in winter when we’ve got significantly higher demand, then that presents a real issue for system stability.”

ADVERTISEMENT

Unfortunately, it could still happen in the winter, depending on whether it turns out to be mild or not.

“People are starting to throw the ‘crisis’ word around when it comes to Europe,” John Kilduff from Again Capital told CNBC. “Europe is squarely behind the eight ball going into the winter season. It’s going to put the focus on this commodity that’s been overlooked for the last several years.”

Gas reserves in Europe are 7.6 percent below the five-year average for this time of year. And there is little hope they will be replenished in time for the start of winter. On the other hand, as summer releases its grip on wind power, output from the North Sea should increase, alleviating some of the shortage.

By Irina Slav for Oilprice.com

More Top Reads From Oilprice.com:



Join the discussion | Back to homepage

ADVERTISEMENT


ADVERTISEMENT


Leave a comment

Leave a comment

EXXON Mobil -0.35
Open57.81 Trading Vol.6.96M Previous Vol.241.7B
BUY 57.15
Sell 57.00
Oilprice - The No. 1 Source for Oil & Energy News