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Julian Lee

Winter Is Coming and Europe Is Running Scarily Low on Gas

Sky-high natural gas prices and low stockpiles mean the continent had better hope for mild temperatures.

Best hope this winter is different from the last.

Best hope this winter is different from the last.

Photographer: Adam Berry/Getty Images Europe

Europe has an energy problem, and it could get worse once winter grips the continent. Gas and electricity prices are soaring, windmills are standing idle for lack of wind and shuttered coal-fired power plants are being brought back into use. There are even suggestions to use diesel generators for private generation. But oil isn’t the solution to the continent’s energy woes.

High natural gas prices are creating incentives for fuel substitution that could boost oil demand, according to Jeff Currie, global head of commodities research at Goldman Sachs. Although that’s true on a global scale, it may not provide much respite for European consumers, who have little scope to switch generators from gas to liquid fuel.