Winter has not yet arrived, but Germany and Italy have already started arguing over natural gas reserves. Italy accused Germany of failing to replenish its stocks, and now by purchasing more gas, they are driving up prices, causing neighboring countries to suffer as well. The German government responded on October 30 that the related accusations were "baseless."
According to Reuters, Alessandro Nocco, director-general of the Italian Ministry of Energy's Department for Energy Markets and Infrastructure, complained during a meeting in Milan on the 29th that Italy had already incurred significant costs in preparing for winter gas storage. Now, due to Germany entering the market and competing for gas purchases, Italy has to pay even higher prices for gas, resulting in a double blow. "This really irritates me," he said.
A fellow energy analyst present at the event said that Germany has focused its attention on the privatization of energy companies Uniper and SEFE, thereby delaying gas storage efforts. Nochet commented that he was shocked to hear that a European country chose not to replenish inventories in order to privatize its companies.
At that time, the utilization rate of gas storage facilities in Germany was approximately 61.7%, while in Italy it was close to 91%. The average utilization rate in the EU was about 75%. The price of European benchmark natural gas futures reached its highest level since December 2022 on the 28th.
A spokesman for Germany's Economy and Energy Ministry denied on the 30th that gas storage was neglected in order to promote the privatization of the aforementioned companies, and also denied that SEFE’s procurement activities caused higher gas prices in Europe. The spokesman said that the government has required those companies to procure goods from outside the EU as much as possible, in order to reduce the impact on the European market.
The German side also stated that even in the event of an extreme cold winter, Europe's gas reserves are sufficient to meet demands. Germany and the EU can rely on liquefied natural gas, pipeline imports, and interconnected natural gas networks to ensure supplies.
