The threat of a major war is growing in the Middle East, but oil prices are plummeting. At the same time, gas storage facilities in the EU are already almost full. In Germany, the level of filling of underground gas storage facilities reached 90% ahead of schedule, writes DW. While in Israel on Monday, August 5, they were waiting for a retaliatory strike from Iran as revenge for the murder in Tehran of the head of the Palestinian terrorist organization Hamas Ismail Haniyeh, and the United States was strengthening its naval group by In the Middle East to protect an ally, oil on the world market rapidly… became cheaper. The commodity market demonstrated a completely atypical reaction: usually, any aggravation of the situation in the Middle East region, where numerous facilities for the production of the most important energy resource and sea routes for its transportation are located, leads to an increase in oil prices. But this time everything is completely different: if on Thursday, August 1, a barrel of the North Sea reference grade Brent cost about $81.5, then by the end of Friday it was given less than $77.5, and on Monday at the time of writing – about 76 dollars, although during the trading the quotes dropped to 75 dollars. And this is the lowest level in 2024. The world market is witnessing the second big wave of oil futures sales in six months. The first started in early April from a level of $91 and reached its climax two months ago, when after the OPEC+ meeting, quotes dropped below $77 during trading on June 4. Even then, the main reason for the collapse was cited as disappointing macroeconomic data from the United States and China, the two largest economies on the planet, with China also being the world’s largest importer of oil. And the immediate reason for the particularly sharp collapse in prices was the decision of a number of key OPEC+ participants, including Saudi Arabia and Russia, to begin gradually increasing oil supplies to the world market in October. This decision clearly contradicted economic statistics, which warned of a decline in economic dynamics in the United States and China and, accordingly, a likely reduction in their demand for oil. True, after that collapse, prices recovered somewhat, although they could not rise above about 87.5 dollars, and since July 5, for exactly a month now, they have been declining, finding themselves now, we repeat, at a level of about 75-76 dollars. At the same time, the so-called support levels were broken, at which the fall stopped in previous times, which, from the point of view of many traders, indicates a high probability of a further decline in quotes. The reason for the accelerated sale of futures since the end of last week was unexpectedly poor data on the state of the labor market in the United States, where unemployment reached the highest level in three years. That has fueled fears that the Federal Reserve, America's central bank, has waited too long to cut its benchmark interest rate in two decades in its fight against inflation, which could push the United States into recession. So the fear of an impending recession in America, sharply intensified by other weak macroeconomic indicators, turned out to be much stronger than the fear of an upcoming new surge in hostilities in the Middle East. It was economic worries that caused the current collapse in quotes (and a significant drop in share prices on leading stock exchanges), and it is unclear how long these fears will now weigh on the market. For Russia, which is mired in the war in Ukraine and needs to increase government revenues, as evidenced, in particular, by the recent decision to increase taxes on businesses and individuals, the current significant reduction in the price of its main export commodity (a barrel of Brent has lost value in a month approximately $12) comes at a particularly bad time. Indeed, according to Bloomberg estimates, maritime exports of Russian Urals crude oil are at their lowest level since December 2022. So both prices and export volumes fell at the same time. In this situation, Moscow could find some consolation in the surge in natural gas prices in Europe. Here the market demonstrated a completely standard reaction to rising tensions in the Middle East: if in the first half of July on the TTF trading floor in the Netherlands the September futures contract cost 32 euros per megawatt-hour, then in the last days of the month it went up sharply and on August 1 reached 37 MW ⋅h (approximately $400 per thousand cubic meters). However, the rise turned out to be short-lived, and already on Friday the price went down, and on Monday, August 5, it dropped below 35 MWh. An obvious factor that will restrain the strong growth of quotes in the near future, no matter how events develop in the Middle East, is the high level of filling of underground gas storage facilities in the European Union. Thus, in Germany, which has, by a large margin, the largest underground gas storage capacity in the EU, gas storage facilities are now, at the beginning of August, already 90% full. This means that in recent months the injection has been hugely ahead of schedule, because the law in force since 2022 requires that the level of 85% be ensured only by October 1 and 95% only by November 1. The situation is similar in other EU countries. Italian underground gas storage facilities, the second largest in the EU, are more than 88% full, according to data from the Gas Infrastructure Europe (GIE) portal; in the Netherlands, which is in third place, this figure exceeds 81%. In countries where liquefied natural gas (LNG) plays a significant role in the consumption structure, the level of filling of underground gas storage facilities is: in France 79%, in Belgium 88%, and in Spain and Portugal almost 100%. If we take the EU countries that receive Russian gas thanks to the current Ukrainian transit until the end of 2024, then in Slovakia, Austria and the Czech Republic, gas storage facilities are approximately 87% full. And in Hungary, which Gazprom supplies via the second, European line of the Turkish Stream, this figure is 84%. As a result, the average filling level of gas storage facilities in the EU has reached, according to GIE calculations, approximately 86%. All this means that in the coming weeks, the demand for natural gas from German and other European importers should, in theory, decrease noticeably and remain low, at least until the actual start of the heating season in one and a half to two months, or even later. depending on the weather. After all, after 100% filling of underground gas storage facilities, energy companies in EU countries will stop large-scale purchases of fuel in reserve and will purchase it only to meet current demand. Thus, in the coming months, Gazprom and Novatek have little chance of significantly increasing supplies of pipeline and liquefied natural gas (to which EU sanctions do not apply) to Europe, thereby taking advantage of its current relative rise in price. 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