EU countries need to brace for a price crisis in gas and electricity and start cutting back before winter, EU energy commissioner Dan Jorgensen has warned energy ministers from the 27 member states.
Gas prices in Europe have more than doubled since the war with Iran began, and storage levels have reached just over 70%, well below the usual level for this time of year of around 86%.
Under EU rules, storage must reach 90% before the heating season starts, though countries get some leeway: a 10-point margin, plus another 5 points if market conditions turn bad. Jorgensen said lowering the target to 80% would ease some of the pressure on prices now and make it cheaper for countries to fill their reserves. He also asked governments to look at ways to keep up the pace of storage or cut how much energy they use.
"We are facing a price crisis tied to a supply crisis," Jorgensen said.
Building up reserves has been harder this year because prices started climbing once the conflict in the Middle East began. Gas for quick delivery ended up costing more than winter contracts, which made storing gas over summer less worth it.
Europe is highly exposed to shocks on world markets because it depends on imported fossil fuels, Jorgensen said.
The Commission wants countries to start getting ready for the heating season before the cold hits. The biggest danger is that higher prices, low storage and reliance on outside supplies could all hit at the same time before winter.
High energy costs are also spreading to liquid fuels, where tight supply and strong demand are pushing prices up. Diesel already costs more than 2 euros a litre in several European countries.