Highlights

  • Demand from Europe's largest markets set for limited growth this summer
  • Further cuts to Groningen's cap will limit European production this winter
  • The pace of storage restocks has picked up, but further gains are needed
  • Support for hub prices is seen as the market tightens

Economic overview

Greece voted against accepting the bailout package offered by its creditors, and while a new deal has been agreed, it has not yet been finalised.

Greece failed to make a repayment of €1.5 billion ($1.67 billion) to the International Monetary Fund (IMF) at the end of June – the first time an EU nation has failed to do so. Greece then closed its banks, limited withdrawals from ATMs, and placed restrictions on moving money outside the country. 

GDP forecasts

  2013 2014 2015 2016
Germany 0.2% 1.6% 1.6% 2.3%
Netherlands -0.7% 0.9% 2.0% 2.2%
United Kingdom 1.7% 2.8% 2.4% 2.3%
France 0.7% 0.2% 1.1% 1.7%
Italy -1.7% -0.4% 0.6% 1.5%
Spain -1.2% 1.4% 2.9% 2.8%
Greece -4.0% 0.7% 0.1% 2.3%
Source: OECD, Real GDP forecast

In a national referendum on 5 July, the country voted to reject the terms offered for an extended bailout of its debts. The country’s finance minister Yanis Varoufakis has since resigned, although Prime Minister Alexis Tsipras will stay on. The rejection of the bailout terms has put pressure on the euro. The long-term outcome and economic impact on Greece and the eurozone will take time to become clear as approvals to finalise the new agreement are continuing. Despite a new bailout package having been struck, uncertainty continues, which will weigh on economic growth in the region.

Supporters of a UK exit from the EU seized on the result of the Greek referendum, arguing the instability it brought to the eurozone and the EU strengthens the case for a ‘Brexit’. However, the argument was weakened by the new deal being reached. 

The UK’s GDP growth in Q1 2015 was higher than initial estimates, according to official figures. The country’s GDP grew by 2.9% in Q1 on an annual basis compared with an early estimate of 2.4%, according to figures from the UK Office for National Statistics. The UK’s GDP is expected to grow by 2.4% in 2015 as a whole, down from 2.8% last year. The OECD predicts growth will fall further in 2016, to 2.3%. Gas demand is expected to rise this year, but the upside to market expansion will be limited if the UK and other major European gas markets are hit by the continued economic uncertainty regarding Greece.