Ukraine Storage Stocks Rise in May

Ukraine storage stocks rose 1.97bn m³ in May, and reached 11.46bn [Russian] m³ as of June 1, state Naftogaz said June 4.

There are now 1.84bn m³ more in storage than on the same date a year ago, it said. Further, Ukraine is continuing to build up its reserves ahead of winter, which this year carries the additional risk of a dispute with Gazprom.

The two sides have not agreed terms for transit from January 1, when their ten-year contract expires, and Gazprom is likely to need a lot of transit capacity as its 55bn m³/yr NordStream 2 project will not be ready by then. It is not even sure what route it can use to cross Danish waters.

Naftogaz has said that it needs 20bn m³ in storage to guarantee stable winter supplies for the coming winter, which is more than it has had in either of the past two years at least. It does not buy Russian gas directly but most if not all of the gas it imports from western and central trading houses originates from Gazprom's fields.

Naftogaz did not comment on how much of the gas in store is third-party gas but Russian pipeline exports to Europe did rise in May by about 9%, and storage across Europe has been rising generally as traders have captured the summer-winter price spread.