Germany faces billions in winter energy costs as gas reserves lag

German consumers and industry risk billions of euros in additional energy costs this winter as low gas inventories leave the country exposed to cold snaps and supply disruptions, Bloomberg reported.

Germany’s storage sites are about 51% full, compared with almost 82% in Italy and a 63% average across the European Union. The country’s facilities are also the bloc’s largest, so strains in Germany could affect other markets.

Summer gas prices have risen above winter contracts, making it uneconomical for traders to stockpile fuel. The situation is especially sensitive after Germany lost pipeline flows from Russia in 2022.

Analysts said Germany is likely to avoid a physical gas shortage because it can pay for additional supplies, but competition for imports could push prices higher and force the country to reduce exports to neighboring markets.

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