European natural gas futures rose by 3% to €43/MWh on Thursday, rebounding from a 3.7% loss in the previous session, as colder weather forecasts for April spurred increased demand and uncertainty persisted over a potential Ukraine ceasefire.
TTF prices rebound on Thursday
The market remains focused on Europe’s ability to replenish its gas storage levels ahead of the coming winter, with current storage levels standing at 36.2% and a target of 90% set for November 1. The forecasted cold snap is likely to push up consumption, raising concerns over how quickly Europe can fill its reserves.
On the geopolitical front, Ukraine signaled support for a US-backed 30-day ceasefire, which has raised hopes for a temporary reduction in hostilities and potential stabilization in the region. However, Russian President Vladimir Putin has expressed skepticism about the plan, and ongoing attacks on energy infrastructure continue to pose significant risks. The conflict has already disrupted energy flows, and further escalations could impact gas supplies and transportation routes across Europe.
EU still dependent on Russian LNG
Despite Europe’s efforts to diversify its energy sources and reduce reliance on Russian energy, the bloc still remains heavily dependent on Russian LNG to meet its energy needs. This dependency complicates Europe’s broader energy strategy, particularly as it balances energy security with defense priorities. The focus on bolstering defense spending in response to heightened tensions with Russia has also led to less emphasis on further reducing Russian LNG imports in the short term, leaving the energy market exposed to the volatility of geopolitical developments. As such, the market continues to closely watch both weather conditions and political negotiations as they play a key role in shaping Europe’s energy outlook for the months ahead.
