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(Bloomberg) — European natural gas prices fell further, trading near their lowest levels in a month amid tepid demand and the completion of maintenance work in Norway.
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Benchmark futures in the Netherlands fell 4.7% before paring losses, while UK prices also fell. Hot weather in some countries has not translated into much higher consumption for cooling needs, and storage sites on the continent are now 80% full, helping to keep a lid on prices.
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In Britain, demand has remained well below seasonal norms in recent weeks, sending the country’s LNG imports down to their lowest levels since September 2021. The UK does not have storage sites as large as those in continental Europe, which has led to a significant decline. demand during the warmer months as it cannot store fuel for the winter.
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While these developments point to the abating of the energy crisis that sent prices to record levels last year, another test will come this winter. Cold weather can quickly deplete large stocks built up over the summer.
“Europe looks well positioned for the winter season, but any sign of upcoming tight balances will pressure markets and test their resilience,” said Andy Sommer, Fundamental Analysis and Modeling Team Leader at Axpo Solutions AG.
The market is also focused on completing maintenance at major facilities in Norway later this week and any updates from the country’s network operator Gassco AS, according to advisor Zenergi.
Gas in the first month in the Dutch center was down 3.2% to €29.28 per MWh by 1:13pm in Amsterdam. The UK equivalent fell 2.2% to 71.95p.
— With assistance from Priscilla Azevedo Rocha.
