Get 40% Off
🤯 This Tech Portfolio is up 29% YTD! Join Now to Get April’s Top PicksGet The Picks – Just 99 USD

European Gas Prices Rise as Another Cold Snap Approaches Region

Published 15/12/2022, 10:06
Updated 15/12/2022, 10:06
© Bloomberg. Lights on inside office buildings during the early morning in the La Defense business district in Paris, France, on Wednesday, Dec. 14, 2022. Paris is close to claiming crown of Europe's biggest equity market from London as the differential between the markets has been gradually eroding since Britons voted to leave the European Union in 2016.

© Bloomberg. Lights on inside office buildings during the early morning in the La Defense business district in Paris, France, on Wednesday, Dec. 14, 2022. Paris is close to claiming crown of Europe's biggest equity market from London as the differential between the markets has been gradually eroding since Britons voted to leave the European Union in 2016.

(Bloomberg) -- European natural gas prices edged higher amid signs temperatures in northern Europe will drop below seasonal norms once again ahead of Christmas, boosting heating demand.

Benchmark futures rose as much as 2.5% after opening down in thin trading on Thursday. Despite warming temperatures across the region early next week, temperatures are set to return below the seasonal average by the end of next week in the Nordics and the UK, according to forecaster Maxar.

EUROPE WEATHER: Milder Weather to Be Short-Lived in UK, Nordics

A cold blast is now sweeping through northwest Europe, boosting demand for gas in heating. Amid severely reduced Russian pipeline-gas flows, the region is relying on stockpiles it amassed over the summer and mild fall. In addition, a record — for the time of the year — number of tankers are arriving with liquefied natural gas. But attention is shifting to next year.

Meanwhile, competition for LNG is set to intensify as Beijing pivots away from its Covid Zero policy, which is poised to boost demand. China bought several shipments of the fuel for next year. Europe’s record LNG wave this year came largely as the Asian nation’s consumption was subdued. Global supply won’t increase substantially until the middle of the decade. 

“Commodity prices (gas and power) will continue to stay elevated due to geopolitically driven gas curtailments,” analysts at Sanford C Bernstein & Co LLC said in an emailed note. 

Storage sites across Europe are now about 87% full, having shed about nine percentage points over the first month of net withdrawals. For the time of the year, Britain had the highest consumption of gas on record on Dec. 13, according to National Grid (LON:NG) data. 

Dutch front-month futures, Europe’s gas benchmark, traded 1.5% higher at €133.50 a megawatt-hour by 8:36 a.m. in Amsterdam. 

©2022 Bloomberg L.P.

© Bloomberg. Lights on inside office buildings during the early morning in the La Defense business district in Paris, France, on Wednesday, Dec. 14, 2022. Paris is close to claiming crown of Europe's biggest equity market from London as the differential between the markets has been gradually eroding since Britons voted to leave the European Union in 2016.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.