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Home Energy Natural Gas By Irina Slav - Nov 02, 2026, 6:00 PM CST Germany enters winter with gas storage at just 61%, well below the EU's 80% target, raising concerns about shortages during colder weather. European gas prices have surged above €100/MWh, as Middle East supply disruptions and Qatar's extended LNG force majeure complicate winter gas purchases. Germany faces a difficult choice between expensive LNG imports and greater coal use, potentially undermining its energy transition goals.
Germany has missed its gas storage target for the start of winter. Now, the EU’s largest economy faces a difficult heating season as the European gas benchmark topped 100 euros per MWh last week and has stayed there since. Higher prices may turn out to be the smaller problem.
A supply crunch would be worse. Every European Union member state has an obligation to secure enough natural gas ahead of winter to fill 80% of storage capacity. Germany has failed to do that, only filling its storage to about 61%.
This is problematic because Germany has the EU’s biggest gas storage capacity, accounting for over a fifth of the bloc’s total capacity. It is also the biggest consumer of natural gas in the EU. Warnings about Germany’s gas storage levels have been going around for weeks now.
In September, the country’s gas storage association, INES, warned that at the current rate of LNG purchases, Germany would only be able to fill caverns to 77% at best by November 1. It turned out that the prediction was too optimistic, so now, INES has issued another warning. “The failure to meet storage level targets shows that storage levels for coming winters must be guaranteed more rigorously,” the industry body said on Sunday, acknowledging that the war in the Middle East had made gas storage refilling “uneconomical”, as quoted by Reuters.
It appears that a lot of gas buyers both in Germany and other EU member states spent the last few months waiting for a peace deal between Iran and the United States, and lower gas prices, which would presumably make the storage refill economical again. Instead, what they got was the threat of a new escalation after the U.S. midterm elections and an extension of QatarEneregy’s force majeure on LNG exports. Gas purchases are about to get even less economical than they were a month ago.
This means that the state would need to step in to secure enough gas for the winter. This is exactly what Germany’s INES is calling for: “It is therefore right and important that the Federal Ministry for Economic Affairs is open to the introduction of an obligation on suppliers. We must now discuss specific options for the design of a storage obligation at the earliest opportunity, so that it can be enshrined in law without delay,” the managing director of the industry association, Sebastian Heinermann, said.
Not everyone agrees the situation is dire, however. The head of Germany’s energy market regulator, Klaus Mueller, for instance, believes that “It is no longer essential for a secure gas supply that the storage targets be met,” as quoted by Reuters. Indeed, Mueller believes that prompt LNG purchases during the winter would secure enough gas for the EU’s largest consumer, acknowledging gas prices have gone significantly higher.
Judging by benchmark gas prices, the rally is far from over. The TTF contract for both December 2026 and January 2027 is trading above 100 euro per MWh—and so is the February 2027 contract. In other words, gas traders do not expect any peace breakthroughs or a sudden influx of new LNG supply.
This means that Germany is going to have to lean harder on coal in a somewhat ironic development for the EU state with the greatest energy transition ambitions. Reuters reported back in September that higher natural gas prices were forcing utilities to shift back to coal, making what many see as a pariah fuel profitable again, despite the added cost of carbon offsets, which are highest for coal power plants. Indeed, at the time, analysts predicted that coal power generation across the EU was about to jump by 25% over the six months to March 2027 as gas generation suffers the effects of high prices.
In this situation, Germany faces an unpleasant dilemma. It could either mandate gas purchases at exorbitant prices—which will become even more exorbitant as the purchases start—or it can boost coal purchases to secure power generation during peak heating season. Neither alternative is particularly appetizing for the emission-focused German government, but one of them, or both, would be forced on it by the constraints of physical reality, which dictates that winter is the time of little sunlight and low winds.
On top of that, it appears that winter, at least in its early days, will not be mild. In fact, forecasters expect colder than usual temperatures for Germany in the coming days. This could aggravate the problem—because there are only so many coal power plants that have not been shut down yet in service of energy transition targets.
And they have limits to their capacity to react to higher demand. “Even if the price of gas reaches €100/MWh, the power sector could not react that much more,” one ICIS analyst told Reuters back in September. Now, the price of gas has reached 100 euros.
Coal generators have limited capacity. It seems the gas buying will have to take place, whatever the price. By Irina Slav for Oilprice.com More Top Reads From Oilprice.com Brent Hits $117 as Tanker Catches Fire in Strait of Hormuz Japan to Tap $7 Billion from Government Fund to Subsidize Gasoline Prices European Gas Tops 101 Euros for First Time Since 2022 Download The Free Oilprice App Today Back to homepage Irina Slav What I Cover Irina Slav has been writing about global energy markets since 2007, covering the oil and gas industry, energy security, commodities, and the...
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