Uniper CEO Michael Lewis warned that Germany could face natural gas shortages next winter unless the country accelerates the pace of filling its storage facilities. Storage levels stood at just 30.6% on May 27, well below the 38.65% recorded a year earlier, according to Gas Infrastructure Europe data. “If we don’t fill the gas storage facilities quickly, we’ll have a problem next winter,” Lewis told the Frankfurter Allgemeine Zeitung.
The rate of refills is alarmingly slow. Lewis told the German business daily that storage levels have been rising since March, but the pace is “still far too slow.” The core problem is money. The jump in European natural gas prices and the futures curve of the Dutch TTF benchmark since the war in Iran began have made storing gas an unprofitable bet for companies.
They are not incentivized to buy expensive gas now and sell it later at a loss. Lewis called for government intervention to change that calculus. He urged Berlin to create incentives for companies to stock up on gas in storage, according to the Frankfurter Allgemeine Zeitung interview.
Without that push, the market will not solve the problem on its own. The math is unforgiving. Europe’s gas prices have surged roughly 40% from pre-war levels.
The Middle East conflict closed the Strait of Hormuz. Iranian missile attacks hit Qatar’s LNG production and export infrastructure. Those strikes wiped off about 20% of global daily LNG flows from Qatar and the United Arab Emirates, Oilprice.com reported.
Supply vanished overnight. That supply shock has reshaped global trade routes. European buyers are now losing the competition with Asia for spot LNG supply.
Asian benchmark gas prices command a large enough premium over European TTF prices to incentivize cargoes turning away from Europe and heading east instead. The United States is expanding its export projects, but those new volumes are chasing the highest bidder. Asia is winning.
The timing could not be worse. Summer is approaching. Heatwaves are expected to boost power demand across Asia.
That will likely intensify the competition for LNG cargoes in the coming months, leaving Europe even more exposed. Germany, as Europe’s largest economy, sits at the center of this vulnerability. Behind the diplomatic language lies a stark reality.
The global gas market is not broken. It is working exactly as designed. Supply is tight, so prices rise.
Cargoes flow to whoever pays the most. Right now, that is not Europe. The continent is being outbid for its own energy security.
This is not the first time Germany has faced a gas storage crisis. The winter of 2022, following Russia’s full-scale invasion of Ukraine, saw a frantic scramble to fill storage sites before the heating season. Berlin succeeded then through a combination of aggressive LNG purchases, demand reduction, and sheer luck with mild weather.
The current challenge is different. The supply disruption is not from a single pipeline being turned off. It is from the physical destruction of production and export infrastructure thousands of miles away.
Qatar and the UAE together accounted for roughly one-fifth of the world’s LNG before the attacks. That capacity will not return quickly. Repairs to damaged facilities take months, not weeks.
The Strait of Hormuz, a chokepoint for roughly one-fifth of global oil and gas transit, remains a flashpoint. Any further escalation could tighten supplies even more. Germany’s storage mandate requires facilities to be 90% full by November 1.
The current trajectory makes that target look increasingly unrealistic. At 30.6% in late May, the country needs to inject massive volumes over the summer months. But with prices elevated and the futures curve in contango—where future prices are higher than spot prices—there is no financial incentive to buy and store gas now.
Companies would be locking in losses. Lewis’s call for government incentives is effectively a request for a state-backed insurance policy against price risk. Berlin could offer contracts for difference, guaranteeing a minimum price for stored gas.
Or it could directly mandate storage levels, forcing companies to fill sites regardless of market conditions. Both options come with costs. Doing nothing comes with a bigger one.
A winter gas shortage in Germany would ripple across Europe. Industrial users would face curtailments first. Households are protected under EU regulations, but factories, chemical plants, and manufacturers would not be.
The economic damage would be concentrated in Germany’s industrial heartland, the same region that suffered most during the 2022 energy crisis. BASF, the world’s largest chemical company, has already restructured its Ludwigshafen operations to cope with higher energy costs. Another shock could accelerate the flight of energy-intensive industry from Europe.
The political calendar adds pressure. Germany heads to federal elections in September 2025. Energy prices and economic security are top-tier voter concerns.
A government that presides over a winter gas crisis would face severe electoral consequences. The current coalition, already fragile, cannot afford another policy failure. Why It Matters: A German gas shortage would force industrial shutdowns across Europe’s largest economy, pushing an already fragile manufacturing sector closer to recession and testing the EU’s solidarity mechanisms just as political support for collective energy action frays.
Here is what the data actually says. Gas Infrastructure Europe’s May 27 figure of 30.6% is not just a number. It is a warning.
Last year’s 38.65% on the same date was itself considered inadequate by many analysts. The gap is widening, not closing. The rate of daily injections would need to roughly double to hit the November target.
That is physically possible. It is not financially viable under current market conditions. The headline is dramatic.
Storage levels are objectively low. Prices are objectively high. Asian competition is objectively intensifying.
The only variable is whether Berlin acts before the window closes. Every week that passes without a policy response makes the math harder. Key takeaways: - Germany’s gas storage is only 30.6% full as of May 27, well below last year’s 38.65%, and the refill rate is too slow to meet the November target. - Uniper CEO Michael Lewis is calling for government incentives to make gas storage economically viable, as high prices and a contango futures curve deter companies from filling sites. - The destruction of Qatari and UAE LNG infrastructure has wiped out roughly 20% of global daily LNG flows, intensifying competition between Europe and Asia for spot cargoes. - Without faster storage injections, Germany risks winter gas shortages that would force industrial curtailments and deepen economic damage.
What comes next will be decided in Berlin, not in the gas markets. The German government must choose between direct financial intervention to subsidize storage or accepting the risk of winter shortages. The Bundestag returns from its summer recess in early September.
That leaves roughly eight weeks for the economics and energy ministries to design a mechanism, secure coalition agreement, and implement it before the injection season ends. The alternative is hoping for mild weather and Asian demand to collapse. That is not a strategy.
And Germany’s industrial base is the stake.
Key Takeaways
— Germany's gas storage is only 30.6% full as of May 27, well below last year's 38.65%, and the refill rate is too slow to meet the November target.
— Uniper CEO Michael Lewis is calling for government incentives to make gas storage economically viable, as high prices and a contango futures curve deter companies from filling sites.
— The destruction of Qatari and UAE LNG infrastructure has wiped out roughly 20% of global daily LNG flows, intensifying competition between Europe and Asia for spot cargoes.
— Without faster storage injections, Germany risks winter gas shortages that would force industrial curtailments and deepen economic damage.
Source: Oilprice.com
