Despite efforts to secure energy stability, Europe is once again grappling with gas supply concerns. Falling reserves and rising prices threaten industries and consumers alike, reigniting fears of another energy crisis.
Mounting Energy Concerns in 2025
Three years after Europe's worst energy crisis, gas reserves are depleting faster than expected. A combination of colder winter temperatures, lower renewable energy production, and disruptions in Russian gas transit have strained supply chains, pushing prices higher.
As reported by Linternaute, Europe's gas storage levels dropped significantly by mid-March, with reserves standing at just 34% capacity, far lower than the 60% recorded in 2024. France has been hit particularly hard, with reserves plummeting to 21%.
Gas Reserves at Critical Levels
Several factors have contributed to this situation:
Europe experienced a colder-than-usual winter, leading to higher energy consumption. Additionally, declining renewable energy production in November resulted in an 80% surge in gas demand. The cessation of Russian gas transit via Ukraine in late 2024 further strained supply, even though it previously accounted for only 5% of Europe's total gas consumption.
These developments forced operators to rely more on stored gas, reducing imports by 6% in 2024 and driving prices upward.
Rising Prices and Industrial Concerns
With reserves dwindling, gas prices are surging. In 2024, wholesale gas prices had dropped to 34 euros per megawatt-hour (MWh), but in 2025, they are expected to reach 45 euros per MWh—almost twice pre-crisis levels.
This price surge poses significant challenges for industrial competitiveness, as European gas prices remain 30% higher than in China and five times higher than in the U.S. Energy security is also a pressing issue, with the EU mandating that gas storage reaches 90% capacity by November 1. However, replenishing reserves will require substantial LNG imports, increasing competition with Asian markets.
Future Outlook: Stability After 2026?
The global supply of liquefied natural gas (LNG) is expected to grow by 5% in 2025, but this will not fully offset the loss of Russian pipeline gas. Analysts predict that gas prices will remain volatile until major new LNG projects, especially from the U.S. and Qatar, come online after 2026.
To stabilize the market, European countries must accelerate investments in renewable energy, energy efficiency, and alternative supply sources. While relief is expected in the coming years, 2025 remains a critical year for Europe's energy security and industrial stability.
