75% of Italy’s gas storage is filled — the highest among European leaders — as the country buys more LNG than any other in the EU this month. The move places Italy in first place for liquefied natural gas imports in the bloc, with traders capitalizing on state incentives to stockpile despite record prices.
While Germany and France allowed their storage levels to fall, Italy’s power sector — the most gas-dependent in Europe — has kept buying. Recent heat waves raised energy demand, but government-enforced storage targets and penalties for underfilling have also encouraged traders to act. This contrasts with Germany, where facilities are at 47% capacity — the lowest for this time of year since 2009.
The strategy has raised the question of whether other governments should support LNG purchases as tensions in the Middle East and Asian demand keep prices high. The European gas crunch is playing out in divergent ways. Italy’s aggressive approach could become a model if prices stay elevated. Or it could be a costly miscalculation if supplies stabilize before winter.
Gas futures in Europe have risen more than 30% this month. Analysts including Goldman Sachs warn that prices could reach €100 per megawatt-hour in December — 75% above current levels — if the supply crisis deepens. Winter contracts are trading at a discount to summer, making stockpiling uneconomical for most traders. Yet Snam SpA, the Italian gas network operator, says its company is on track to fill 90% of its storage and expects others to catch up.
Agostino Scornajenchi, CEO of Snam, said this week that “it’s likely that gas prices will continue to be in tension over the coming months.” That tension is already visible in the market. Other big buyers in Asia are pulling cargo away from Europe, and US strikes in the Persian Gulf have added more uncertainty.
Italy’s 75% storage fill rate is below the five-year seasonal average but is the highest among top EU markets. The strategy reflects both economic necessity and policy design. But it also means higher bills for consumers. If the worst-case scenario plays out — continued disruptions and no relief — Italy’s expensive gas will be less of a risk and more of a lifeline.
If, however, supply improves and prices fall, the country may end up with costly fuel locked into storage. This creates a dilemma for governments: when to act and at what cost. Italy’s gamble is clear.