Russia is meeting is contractual obligations to ship gas to Europe, but its exports to the continent are still down from levels in 2019, before the global pandemic, the agency said. More gas flowing from the east would help Europe boost its stockpiles before the winter.
Gas prices in Europe are breaking records day after day as top supplier Russia keeps a cap on the additional flows needed to refill storage sites. Norway has struggled to sell more due to heavy maintenance while Asia is scooping up cargoes of liquefied natural gas, leaving Europe starved of the fuel just a few weeks before the heating season starts.
“Russia could do more to increase gas availability to Europe and ensure storage is filled to adequate levels in preparation for the coming winter heating season,” the IEA said in a statement on its website. “This is also an opportunity for Russia to underscore its credentials as a reliable supplier to the European market.”
Gazprom PJSC, Russia’s state-owned gas producer, didn’t immediately respond to a request for comment.
The IEA was created to defend the energy interests of rich industrialized countries. The agency is no stranger to interventions in the oil market, sometimes calling on the OPEC to boost supply and on rare occasions coordinating the release of emergency fuel stockpiles. It’s less common for the Paris-based organization to get involved in gas markets.
Energy prices are soaring from the U.S. to Europe and Asia as economies rebound from the global pandemic and people return to the office. In Europe, gas supplies were already low after a long cold winter left storage sites depleted, and refilling them hasn’t been easy.
Europe is entering the heating season in just a few weeks with the lowest inventories in more than a decade, leaving the market vulnerable to price volatility when the sun isn’t shining or the wind isn’t blowing — curbing the output of renewable power.
“Going forward, the European gas market could well face further stress tests from unplanned outages and sharp cold spells, especially if they occur late in the winter,” the IEA said.
The agency stressed that it’s wrong to blame the shift away from fossil fuels for the spike in gas prices.
“Recent increases in global natural gas prices are the result of multiple factors, and it is inaccurate and misleading to lay the responsibility at the door of the clean energy transition,” said IEA Executive Director Fatih Birol.