“Gazprom” is stocking up on gas instead of Europe: production has reached its maximum in 13 years

In the first half of this month, the oil and gas company produced about 1.367 billion cubic meters of gas per day on average. This was the highest figure since 2008.

For example, during the same period a year earlier, the daily gas production reached 1.217 billion cubic meters, whereas in September of the pre-crisis year, this value was about 1.235 billion cubic meters.

The reason for the record figures is the fact that in 2021 the heating season in Russia started a week earlier than usual. Thus, heating has already been turned on in 25 regions of the country.

The resource is being pumped into the domestic gas storage facilities at a rapid pace. The results for the first half of this month show that the average daily volume of supplies is around 325 million cubic meters.

Since the beginning of the year, according to preliminary data, “Gazprom” has produced more than 357.7 billion cubic meters of gas, which is 17.8% more than during the same period last year.

At the same time, natural gas prices in Europe hit a new high during today’s trading: quotes on the ICE exchange reached the peak of USD 970 per thousand cubic meters. After that prices went down a bit and are now near the level of $880 for the same volume.

The increase in the futures contract price since the opening of trading is about 10%, while in August the average value of the paper was $533 per one thousand cubic meters.

Analysts believe that given the current market situation, the European gas prices may exceed the psychologically important mark of $ 1000 per thousand cubic meters. Weather conditions in the region during the heating season and the announcement of the launch date of Nord Stream 2 gas pipeline owned by Gazprom will be the main factors affecting further price movements.

The level of gas reserves in underground gas storage facilities in Europe remains quite low, with about a month to go before the transition from pumping to withdrawal from the reservoirs. European storage capacity is currently at just over 70 percent, 15 percent below the average level of the past five years.