This year’s winter gas season opens with extreme levels of natural gas prices and volatility, due to unprecedented supply uncertainty and Russia severely curtailing its pipeline deliveries to Europe. The result is significant market tension in other sources of supply. Security of supply is now a top priority in Europe and other importing regions as a complete cut-off in Russian flows to Europe cannot be eliminated, creating further tension and destroying demand for all competing LNG importers .
The gas crisis triggered by the Russian invasion of Ukraine in February 2022 has led to a series of market adjustments. European buyers have strongly increased their LNG supply, leading to market tightening and demand destruction in various importing regions. This has also had a visible impact on LNG contracting behaviours, with a return to more traditional features such as fixed destination and long term contracts. The European Union, whose member states are under the threat of further supply cuts, has taken a number of measures to improve security of supply and market resilience ahead of the coming winter.
This quarterly report includes the IEA’s annual report Global Gas Security Review and analysis of the short-term evolution of the gas market until 2023.