European gas falls below €30: mild weather, rising imports and hopes for peace push prices down

Market hits its lowest level in over a year. Above-average temperatures, stronger supplies and diplomatic progress on the Ukraine war weigh on gas prices, though the overall outlook remains fragile.

European natural gas prices have fallen below €30 per megawatt-hour, reaching their lowest level since May 2024. It’s a threshold not seen in more than a year and reflects a combination of bearish factors: rising imports, milder-than-expected weather, and renewed discussions on ending the war in Ukraine.

After weeks of relative stability, during which futures moved within a narrow range, traders now face a more reassuring picture on the supply side. Increased arrivals of liquefied natural gas and solid Norwegian pipeline flows have helped meet demand, easing earlier concerns over relatively low storage levels. Weather forecasts add to the downward pressure: early December is expected to bring temperatures above seasonal norms, reducing heating needs across the continent.

Diplomacy is also influencing market sentiment. Talks between the United States and Ukraine in Geneva have suggested progress toward a potential agreement involving Presidents Zelenskiy, Trump and Putin. Such developments could reshape global energy dynamics, ahead of new LNG projects coming online in 2025.

Although Russia now accounts for only about 10% of Europe’s gas imports—far from its dominant role just a few years ago—the market remains highly sensitive to geopolitical signals. “Above-normal temperatures and international developments may drive prices even lower, but it won’t take much positive news for gas to push them up again,” warns Arne Lohmann Rasmussen of Global Risk Management.

Prices remain higher than before the 2022 energy crisis, although they are nowhere near the peaks that triggered a continent-wide cost-of-living emergency. On Monday morning, Dutch TTF front-month futures—the European benchmark—were trading at €29.82 per megawatt-hour, nearly half the levels seen last February.

Andrea Pelucchi