Gas traders and analysts warned against complacency

[suchona.kani.z]

The European Central Bank (ECB) recently raised interest rates by a quarter of a percentage point. Yes, but...

Gas prices remain very high by historical standards. In 2019, the average TTF price was below 15 euros. The pre-crisis peak was 29.17 euros in 2018, which is still slightly below the current price level even after adjusting for inflation.

Europe could also face challenges in the coming winter. The mild winter in particular, combined with a decline in LNG demand in China, was a fortunate circumstance. There was a lack of foresight.

The International Energy Agency (IEA) has warned in its latest quarterly gas market report that the balance between supply and demand is facing an unusually high level of uncertainty this year, ranging from the indonesia consumer email list weather to the availability of liquefied natural gas to the possibility of a further decline in Russian gas supplies to Europe. Russia's remaining pipeline supplies through Ukraine and Turkey now account for less than 10 percent of European gas imports, compared with about 40 percent before the invasion, but traders believe their loss could still trigger another price rise.


The current low gas prices in Europe are the result of several factors, including alternative gas sources, overfilled gas storage facilities, the contribution of renewable energy and various efficiency measures.

These developments have contributed to a significant easing of the European gas market. Nevertheless, we must warn against being too optimistic. Current prices are still high by historical standards, and long-term considerations and uncertainties regarding weather conditions and Russian gas supplies continue to play an important role. Gas traders and analysts warn that Europe could face new challenges in the coming winter. It therefore remains to be seen how sustainable the current low gas prices are. A long-term strategy and a comprehensive view of market developments are crucial to accurately assess the impact on the European gas market.