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UK gas reserves at 'concerningly low levels' amid Russian supply halt

  • By Al Mayadeen English
  • Source: Agencies
  • 10 Jan 2025 21:13
  • 2 Shares
4 Min Read

British gas storage reserves are critically low amid the winter cold and the ensuing energy crisis due to Ukraine halting the transit of Russian gas through its soil.

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  • A view of the Gherkin and other buildings in the City of, London, Thursday, Jan. 9, 2025 (AP)
    A view of the Gherkin and other buildings in the City of, London, Thursday, Jan. 9, 2025 (AP)

The United Kingdom's gas storage reserves have plunged to critically low levels as a result of unusually cold winter conditions and the cessation of Russian gas transit through Ukraine, according to Centrica, a UK gas storage and supply company. 

In a statement on Friday, Centrica highlighted the severe strain on the UK's gas supply, attributing it to "plunging temperatures and high demand for gas-fired power stations."

The company noted that gas storage levels were now about half full, capable of meeting national demand for less than a week. Compared to this time last year, reserves are down by 26%.

The situation was exacerbated by the early arrival of winter in December, which drained reserves at a faster-than-expected rate. High gas prices further hindered efforts to replenish storage before the end of the year.

Adding to the challenge, Russian energy giant Gazprom announced on January 1 that it could no longer supply gas through Ukraine due to the expiration of its agreement with Ukraine's national energy company, Naftogaz. Ukrainian authorities have stated they do not plan to renew the transit deal, effectively ending a key supply route to Europe as of December 31, 2024.

While Centrica warns of low inventory levels, the UK government has sought to reassure the public. A spokesperson for the Department for Energy Security and Net Zero told Sky News that there is no immediate cause for concern, citing the country's diversified energy system.

The National Grid reported that natural gas accounts for 53% of the UK's energy generation, with the majority of supplies coming from the North Sea and liquefied natural gas imports from the US and Qatar.

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However, experts have raised concerns about potential energy price hikes. The Times reported on January 2 that while the UK is less reliant on Russian gas supplies than other European nations, the cessation of transit through Ukraine could drive up prices as European demand for alternative sources increases.

Centrica's statement also noted that similar pressures on gas reserves are being observed across Europe, intensifying fears of a broader energy crunch.

Ukraine not to renew gas transit agreement with Russia

While Ukraine has decided not to renew its gas transit agreement with Russia beyond December 31, 2024, it continues to allow Russian oil transit via the Druzhba pipeline under a contract valid until the end of 2029.

This drew the ire of Hungary, whose Foreign Minister Peter Szijjarto argued that Ukraine's association agreement with the EU obliges it to contribute to the bloc's energy security by maintaining transportation routes. 

"Each state has the sovereign right to decide from where and how it buys the energy resources it needs to function, and no one has the right to impose more expensive energy resources on another country," Szijjarto stated. 

Hungary, along with Slovakia and Austria, depends heavily on Russian gas, purchased through Gazprombank, which is under Western sanctions. Szijjarto claimed that halting energy transit would harm Hungary and contravene EU expectations for Ukraine's integration. He also accused Ukraine of exacerbating Europe's economic challenges, alleging that its actions have driven up gas prices on the EU market. 

Szijjarto's remarks come amid ongoing criticism of Hungary for its Moscow-friendly stance. Budapest has frequently blocked sanctions against Russia and aid packages to Ukraine, setting itself apart from other EU member states.

Szijjarto has maintained relations with Moscow during the war, drawing further scrutiny from European partners. The proposed Ukrainian bill and Hungary's reaction underscore the complex dynamics of energy security, EU integration, and regional alliances amid the ongoing conflict in Ukraine. 

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