Gas prices rise on exchange, Czech storage facilities only 70 percent full

Gas storage facilities in Czechia were nearly 70 percent full at the start of September. The Czech Republic has thus met the EU's interim targets for this period, but stocks are roughly a fifth lower than a year ago. This follows from information provided by the Ministry of Industry and Trade (MPO) and the Energy Regulatory Office (ERÚ). According to the ministry, there should be enough gas for the coming winter despite the slower filling of storage facilities.

According to analysts, the slower replenishment of gas stocks is a result of rising gas prices on the exchange. The wholesale gas price for the European market exceeded 75 euros (CZK 1,817) per megawatt-hour (MWh) on Wednesday morning, reaching its highest level in more than three years. According to analysts, the market is also reacting to the renewed attacks between the United States and Iran, as well as lower gas stocks in Europe.

"Like in previous years, the Czech Republic has met the European indicative milestone of at least 60 percent storage filling by 1 September. We have no information whatsoever that the main European target of 80 percent filling for the period from 1 October to 1 December will not also be met," MPO spokesperson Tadeáš Provazník told ČTK.

According to Provazník, Minister of Industry and Trade Karel Havlíček (ANO) and other ministry representatives regularly hold talks with traders and storage facility operators. None of the traders has indicated any problems, he said.

"Gas supplies should be secured without problems even during the coming winter," Provazník said.

According to him, traders use a combination of gas stocks in storage facilities, long-term and forward contracts, and ongoing purchases. "At present, nothing indicates that the Czech Republic faces a gas shortage ahead of the coming heating season, although storage facilities are being filled more slowly this year than last year," Provazník added.

Stocks in Czechia are currently slightly above the EU average. According to ERÚ data, European storage facilities are now just under 65 percent full.

According to analysts, the current rise in gas prices on the exchange will gradually increase household supply prices in the coming months as well. However, this will not be a blanket price increase; prices will rise mainly for new fixed-price contracts. According to analysts, the coming winter and further developments in the geopolitical situation will be crucial for longer-term price trends.