Germany's gas reserves dip to historic lows amid Iran conflict

Germany's gas storage network, comprising over 40 underground facilities, is barely above the halfway mark at 50.14%, the lowest mid-August reading in recent memory. The decline follows a period of robust stockpiling after Russia's invasion of Ukraine, when imports of LNG from the United States and Qatar and pipeline gas from Norway helped diversify supplies. This year, the Iran war has closed the Strait of Hormuz, pushing global gas and LNG prices up and reducing traders' incentive to buy cheap summer gas for winter reserves.

Private energy traders dominate Germany's market, unlike some EU states that use strategic reserves, leading the Economy Ministry to call for increased storage. The Federal Network Agency’s FNB Gas warns that the government’s target of 71% by November 1 is now virtually unattainable, and consumer groups fear higher winter bills.