Europe Gas Prices Extend Fall After Weeks of Intense Volatility

image is BloomburgMedia_RWHJODDWRGG001_19-06-2023_12-00-07_638227296000000000.jpg

Pipework at the Equinor ASA natural gas production facility in Karsto, Norway, on Thursday, April 20, 2023. Equinor ASA and Norwegian airport regulator Avinor aim to open the airspace over the North Sea for “advanced drone operations,” with the goal to develop an uncrewed traffic management space. Photographer: Carina Johansen/Bloomberg

European gas prices plunged for a second day, paring some of this month’s gains after several weeks of intense market volatility linked to supply risks and hot weather. 

Benchmark futures dropped as much as 14% on Monday morning, after closing last week with the biggest drop since August. Prices are still up about 15% this month, following a series of unplanned outages and hot weather warnings put traders on edge about the balance of fuel supply and demand. 

After weeks of turbulent price swings, cooling gas costs suggest that some stability might be returning to the market. Inventories remain fuller than usual for the season, but the possibility of further outages — or a sudden pick-up in fuel demand among businesses and households — could still present a threat to the region’s supply ahead of its next heating season. 


Warmer-than-normal temperatures are expected across parts of northern Europe early this week, with temperatures in Frankfurt and Berlin surpassing 30C (86F), according to forecaster Maxar Technologies Inc. That could boost demand for cooling, potentially impacting prices.

The recent volatility in gas markets “highlighted complications for traders,” who are now assessing whether the energy crisis is still severe enough to continue importing additional liquefied natural gas cargoes during the summer months, Inspired Energy analysts said in a note last Friday. 

While it still looks like the European Union is on track to meet storage targets of 90% by November, there are concerns that short-term demand — prompted by a pick-up in Asia or greater cooling needs — could impact the plan, the analysts wrote.

Benchmark Dutch front-month gas were down 9.3% at €31.75 a megawatt-hour by 9:21 a.m. in Amsterdam. The UK equivalent fell 8.6%. 

©2023 Bloomberg L.P.

By Priscila Azevedo Rocha


Subscribe to our newsletter and get the best of Energy Connects directly to your inbox each week.

By subscribing, you agree to the processing of your personal data by dmg events as described in the Privacy Policy.

Back To Top