Europe's energy crisis is spreading and has moved from empty gas storage tanks and is now hitting petrol pump prices, soaring electricity bills as the cost of German winter electricity spiking to over €180 per megawatt-hour.

Wholesale power for delivery in January in Germany, the region's biggest economy, now the highest in Europe and more than 60% dearer than a year earlier on the European Energy Exchange. Europe’s gas storage is at record lows, driving costs up as it is now too late to get to the requisite 90% full by November 1 and its clear there will be a shortage. Just how bad things gete now entirely depends on the weather.

The benchmark Dutch TTF gas contract is trading much lower – at around €80/MWh - close to three times where it started the year, and EU storage was 69.31% full on September 18 with six weeks of the injection season left – 20pp off the target volumes.

The gas storage shortfall has persisted since spring. Higher power prices, fuel costs and freight rates are adding pressure on consumers and governments.

Kirill Dmitriev, chief executive of the Russian Direct Investment Fund and President Vladimir Putin's envoy for investment cooperation, has been gloating over Europe’s problems. He wrote on X that Europe "finally understands it is facing the worst energy crisis in history", TASS reported on September 19, calling a French petrol shortages proof that energy restrictions in the EU were "finally arriving".

The tanks finish short

EU storage stood at 69.31% of capacity on September 18, holding 784 TWh, on Gas Infrastructure Europe's AGSI data. The same date a year earlier read 81.23%. Germany has been slipping into a gas crisis since a cold winter drained its sites below seasonal norms, and the summer refill never caught up: storage was emptier in August than in the 2022 crisis year.

An IntelliNews Lambda analysis in August put EU storage at 77% on November 1. An updated calculation gives a lower estimate. Holding each country's gap to its own 15-year seasonal baseline constant through the rest of the injection season - an assumption that needs to be tested against the underlying series - the bloc finishes the restocking season at roughly 73%, some 17 percentage points below its 90% target. It would also land below the 75% floor that ING analysts Warren Patterson and Ewa Manthey warned in late August would already be difficult to reach.

EU gas storage on September 18, 2026, with November 1 estimates. Source: GIE AGSI, IntelliNews Lambda calculations.

Germany is still where the missing gas is. Its sites, about 22% of EU working capacity, were 56.26% full, 29 percentage points under their seasonal norm, and on the same method open the heating season near 60%. The Netherlands is worse in percentage terms at 54.55%, and Slovakia, at 53.30%, has fallen 30 points behind its own baseline. Poland at 98.32%, Italy at 85.32% and Hungary at 73.33% are at or above normal, so the bloc-wide figure hides how uneven the position is. Ukraine, outside the EU system and 35.56% full, has even been shipping surplus gas west.

Historical storage series through August 7, set against the 15-year baseline, are plotted in an interactive chart, with the EU aggregate against its own baseline here.

Gas is setting the power price

Wholesale power for January delivery in Germany above €180/MWh is the strongest winter signal since the last crisis, though it is still barely a fifth of the €1,000/MWh reached in 2022 when Russian pipeline supply was cut off. Europe has built LNG import capacity, cut consumption and spread its suppliers since then, which could reduce the risk of an outright shortage. The trade-off is that it is now exposed to a global LNG market in which distant supply disruptions can affect German power prices.

Where the gas price ends up in a household bill varies enormously. UK domestic energy bills are set to rise 25% in January, while Norwegian state subsidies will largely shield consumers from the wholesale move. French nuclear curtailment from heat and strikes, and low hydro stocks, have added strain across the year.

"There's potential for higher prices in power and perhaps a quicker rally than what we've seen so far," said Ulf Ek, chief investment officer at Northlander Commodity Advisors. "We can hope it's going to be a windy and sunny winter, and if not, then electricity, gas and coal prices will go higher." In a cold winter with Middle East supply still constrained, Ek sees wholesale power rising as much as 50% further.

"There is not much that can shield power markets," said Florence Schmit, a senior energy strategist at Rabobank. "The renewables side has been growing but hasn't been strong enough to make up for this huge reliance on gas."

Without the solar capacity added since 2021, average European wholesale power prices would have been 30% higher this summer, on analysis by consultancy Baringa. Solar does far less in a northern European winter, which leaves wind to carry the load and gas often setting the marginal price when wind output falls. Jefferies analyst Ahmed Farman reckons RWE, Engie and EDP Renewables could see next year's earnings come in 10% above current estimates.

The bill reaches the pump

Pump prices have been setting records across the continent since early September, when German petrol passed its 2022 peak at €2.215 a litre and Dutch Euro95 reached €2.666. Diesel has run harder: German diesel is now around €2.47 a litre and Dutch diesel €2.78, with European diesel futures near $200 a barrel and refining margins at record highs. Across the EU petrol is up 24% on the year, diesel 38% and jet fuel more than 100%.

Some 11% of French filling stations were out of petrol or diesel on September 19, on figures published by the French government, rising to 16% in parts of the country. Average French diesel is €2.38 a litre, less than 1% below its record, and petrol is at or above record highs. President Emmanuel Macron convened an emergency meeting on the shortages and the government is preparing support for high-mileage drivers.

Saudi Aramco, normally the supplier who fills that gap, has become a competitor for the same barrels. It will supply no oil to at least two European refineries in October, according to a September 18 TASS report citing Bloomberg, and has been bidding for diesel cargoes in the Mediterranean and gasoline in Europe after the attacks on its own refineries.

Governments are already paying. Bulgaria unveiled a fuel aid package worth more than €300mn on September 18, including a €50 one-off payment to more than 550,000 low-income people and a three-month excise waiver on propane-butane. Poland has revived a 60% windfall tax on fuel companies.

Freight becomes the second squeeze

A shortage of very large crude carriers has pushed the cost of moving a cargo from Houston to Asia to about $26 a barrel, or $52mn a cargo - roughly a quarter of the West Texas Intermediate price, against a tiny fraction of it before the war, Bloomberg reported.

Supertankers on the Gulf-to-China benchmark route are earning upward of $1.2mn a day, and Suezmaxes average north of $300,000 a day, rates normally seen only for sailing in and out of a war zone. The value of the world's largest oil tanker equities reached a record of almost $70bn this week. "It has never been this expensive to move oil around," said Saad Rahim, chief economist at trading house Trafigura.

The effect is to close the long-haul trades that were supposed to replace lost Gulf supply. US-to-Asia flows have fallen as freight roughly tripled, on Vortexa ship-tracking data. A Japanese refiner bought a cargo of Alaskan crude its plants are not well set up to process simply because the voyage was short. Angolan oil that normally sails to China is selling slowly.

"Current freight levels can become self-limiting over time - they eventually close arbitrage routes and reduce demand for the most expensive long-haul barrels," said Sumit Ritolia, senior manager of modelling at analytics firm Kpler.

Europe is paying up for anything close by. Brent futures topped out near $110 a barrel this week while European Dated Brent physical crude climbed above $131 as buyers chased short-haul cargoes, a premium of more than $20 a barrel for oil already in the neighbourhood.

Disruption beyond Hormuz

US officials say shipments through Hormuz have increased. Oil and LNG shipments through it over the past fortnight hit a six-month high, Admiral Brad Cooper, head of US Central Command, said in a video message on September 19, Bloomberg reported. Gulf allies have moved more than 1bn barrels of crude through it "in the last couple months", he said, and Iran "has exported zero barrels".

Other measurements disagree. UKMTO put commercial traffic through the strait at roughly 90% below its pre-conflict level on September 19 and rates transit risk there as critical. Iran maintains the strait is closed, and a tanker was hit by a projectile there on September 18. Hormuz is also not the only chokepoint in play: the Houthis say they are blockading Saudi ships in the Red Sea, have struck several vessels there, and UKMTO rates the risk in Bab al-Mandeb as significant.

Refinery outages and disruption to alternative routes are adding to the pressure. Saudi Arabia's East-West pipeline, the route built to bypass Hormuz, is still down after drone strikes damaged three pumping stations, with repairs estimated at five to six weeks. Houthi strikes on Saudi territory are now close to daily. Two air-raid alerts sounded over Riyadh on September 19, the first in the capital since April, and an airstrike hit jet fuel facilities at King Khalid International Airport, the Wall Street Journal reported, citing three officials.

Six member states, Germany among them, pushed for a bloc-wide windfall tax on oil companies in August, arguing that refining margins were rising even faster than crude. At their informal meeting in Dublin on September 18-19 several finance ministers, German Social Democrat Lars Klingbeil among them, pressed the European Commission to put a proposal on the table by October, an idea Brussels has so far resisted. Figures circulating in energy markets put the rate under discussion at 33% or more.

Four years after Russian pipeline gas supplies were sharply reduced, the machinery Europe built to replace it works in the sense that nobody expects the lights to go out - so well, on one view, that the commissioner who drafted the mandatory storage target now says it should lapse in 2027. What it does not do is hold the price down. Polish Prime Minister Donald Tusk told an audience this month that Europe cannot compete with the US and China on energy costs, Qatari LNG is not coming back while the strait stays contested, and Asian buyers are paying five-month highs for the cargoes Europe needs. The storage calculation implies a shortfall of roughly 17 percentage points against the 90% benchmark on November 1, with the outcome dependent on subsequent injections and withdrawals.