Eni CEO warns that if a cold wave hits, Europe faces the risk of a surge in natural gas prices this winter

Nora Buli

Reuters Oslo, October 28 - Anders Opedal, CEO of Equinor, said on Wednesday that if cold weather drives up demand later this winter, when inventories have already been depleted and the region is more reliant on attracting scarce liquefied natural gas cargoes, Europe may face another surge in natural gas prices. EQNR.OL

Previously, the Norwegian gas producer reported its highest quarterly profits since 2022 (link), mainly due to soaring natural gas and oil prices this year.

"Current storage levels are the lowest for this time of year since 2011, and there will be competition between Asia and Europe for liquefied natural gas, especially if the weather turns cold," Opedal said at a press conference.

Opedal told Reuters that if a cold snap occurs toward the end of the heating season—when gas inventories may be at their lowest—it could lead to significant price volatility, although he said actual prices are impossible to predict.

This year, with the US-Israeli coalition's war against Iran effectively blocking the Strait of Hormuz and disrupting about 20% of global liquefied natural gas supply, European benchmark gas prices have surged to their highest level since the 2022 energy crisis, more than tripling.

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Europe's underground gas storage facilities help meet higher demand in winter, but at the beginning of the heating season, the fill rate was only 75%, a record low (link).

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Norway is Europe's largest single natural gas supplier, with an extensive pipeline network directly linking its domestic gas production to customers on the European continent and in the UK.

Equinor also sells liquefied natural gas produced at its Hammerfest plant in Norway and has signed US LNG supply contracts, including a deal with Cheniere for 1.75 million tonnes per year.

"The contract with Cheniere is now in effect, which means we also have access to more LNG cargoes," Opedal told Reuters. "Part of this goes to Europe, while other parts go elsewhere," he said.

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