European natural gas futures declined toward €57 per megawatt-hour, retreating from two-year highs, though concerns over storage levels and colder weather continued to provide support.
European gas prices fall amid supply concerns
Europe's gas storage is currently 48.48% full, the lowest for this time of year since 2022, raising concerns about the ability to replenish supplies before winter. A combination of windless days, colder-than-usual temperatures, and reduced Russian gas transit via Ukraine has forced countries to draw heavily from reserves, increasing vulnerability to further supply disruptions.
Gas consumption is projected to rise by 17% this month due to heightened heating demand while freezing temperatures in Northwest Europe could put additional pressure on stockpiles. Geopolitical risks further complicate the situation as traders closely monitor US tariffs, potential increases in LNG prices, and ongoing negotiations over the restoration of Russian gas flows.
Energy uncertainty fuels market volatility in Europe
Additionally, uncertainty around alternative energy supplies and infrastructure capacity adds to market volatility, keeping energy security at the forefront of European policy discussions.
