How Cold Will It Get this Winter?

This is the question on the minds of many in Central and Eastern Europe (CEE). Perennially posed by those who are curious about the weather, this question is taking on a whole new dimension—to say nothing of heightened urgency—by the fact that natural gas supply continuity remains very much an issue in this part of Europe.

During the week of Sept. 8, several nations, including Austria, Poland, and Slovakia experienced reductions in the volume of gas being delivered by Gazprom, the Russian-state controlled company. As reported in the Wall Street Journal on Sept. 12 (on.wsj.com/1oUUTen) these reductions varied from about 10 percent (Slovakia) to 45 percent (Poland) during the period of Sept. 10-12. According to the WSJ story, Gazprom responded that “it was supplying the amounts of gas that was available while pumping gas into storage facilities in Russia.”

On Mon. Sept. 15, the European Commission was reporting that gas flows to the EU had returned to normal levels and Tue., Sept. 16, Gazprom said in a statement following a meeting of its board that “the company is fully satisfying the gas demands of its European partners.”

As shown in the chart on page two, CEE nations are filling their gas storage facilities. However, a Bloomberg story on Sept. 12 quoted Mikhail Korchemkin of East European Gas Analysis as saying: “Only Latvia has enough storage capacity to survive through the winter without Russian gas. Other countries of central and eastern Europe don’t have enough.” (bloom.bg/1qYSLpf)

Russia, Ukraine, and the EU have been holding trilateral negotiations in an effort to end the natural gas stand-off that have led to the curtailment of Gazprom gas shipments to Ukraine (for internal consumption). EU states who rely upon gas deliveries that transit through Ukraine are concerned that such flows could be disrupted for several possible reasons. The EU proposed that these talks resume this week, but no meeting has yet been scheduled.

How cold will it get this winter? Sadly, no one knows at this point in time…