Rising trend

Gas price at highest level for two years

(Bild: BARBARA GINDL / APA / picturedesk.com)

The price of European natural gas continues to soar. On Monday, it reached its highest level for two years with the prospect of further low temperatures.

The trend-setting TTF futures contract for delivery in one month was traded at EUR 58.00 per megawatt hour (MWh) at the start on the Amsterdam exchange. This is the highest level since February 2023.

The price has been trending upwards since mid-December, with the increase accelerating in recent trading days. During this time, the price of the commodity has risen by more than 40%. The market continued to refer to weather forecasts. According to these forecasts, temperatures are likely to fall in north-western Europe in the coming days, which will probably increase the need for heating.

Dwindling reserves
A higher demand for heating could accelerate the withdrawal of reserves. Gas reserves have been falling steadily since the beginning of the year. According to the latest data from the European Gas Storage Association (GIE), the total fill level of natural gas storage facilities in Germany fell below 50 percent last week. At the beginning of the year, German storage facilities were still almost 80 percent full. In comparison: a year ago, the fill level at the beginning of February was around 72 percent.

Despite the recent increase, the price of European natural gas is still well below the level it reached in the early stages of the war in Ukraine. In the summer of 2022, prices rose to well over 300 euros at times.