Despite fast-depleting gas inventories, Europe’s benchmark prices plummeted by more than 5% early on Monday as forecasts of milder weather ahead and a plunge in the U.S. benchmark futures eased concerns about supply.
The front-month Dutch TTF Natural Gas Futures, the benchmark for Europe’s gas trading, slumped by 5.6% as of 9:00 a.m. in Amsterdam on Monday, to $36.41 (30.675 euros) per megawatt-hour (MWh).
This was the lowest price in five weeks, since the second week of January.
Weather models suggest milder temperatures in major gas-consuming countries in northwest Europe over the coming days, easing the pressure on inventories that have dropped to the lowest level for this time of the year since the gas crisis in 2022.
In addition, U.S. benchmark natural gas prices at the Henry Hub have plunged in recent days, following milder weather forecasts and a rebound in production after Winter Storm Fern. The storm had briefly reduced feedgas flows to the U.S. LNG export plants and doubled the American benchmark prices.
However, since the storm eased, draws from storage eased from the record-highs at the end of January, and early on Monday, the front-month U.S. natural gas futures slipped to below $3 per million British Thermal Units (MMBtu).
But Europe is not out of the woods yet.
EU gas storage sites were estimated to be just 34% full as of February 14, according to data from Gas Infrastructure Europe.
Analysts forecast that EU gas storage would be only about 26% full by the end of March, when the winter season officially ends.
End-of-winter supply in storage at the lowest in four years means that Europe will need very high imports in the shoulder seasons and the summer to replenish the stocks to adequate levels of 80-90% full storage by November 2026, as per the EU regulations.
