The European gas price has reached pre-war levels in recent days. In other words, the price is lower than at the start of the war between Russia and Ukraine on February 24. The fall in prices is noticeable because tensions between Russia, Ukraine and the West are still high, with the supply of natural gas also having a strategic position.
The price of the TTF future will be an average of €25 per MWh this Wednesday, May 84,71. That is more than €10 lower than the €94,54 per MWH from a week earlier on Wednesday, March 18. The gas price has fallen in several sharp steps over the past week, with €83,29 per MWh on Monday being the lowest price since February 22 of this year. The movement on the gas market shows that the emotion of the war seems to be slowly fading away from traders, despite the fact that things are certainly not calming down in Ukraine and all the political tensions surrounding it.
LNG supply continues smoothly
For example, the Russian energy giant Gazprom announced last week that it would no longer supply gas to Finland. Russia's Scandinavian neighbor wants to join NATO and not pay for Russian gas in rubles. Ultimately, this did not disturb the gas market. At the end of April, Russia cut off gas to Poland and Bulgaria. In other countries such as Italy, financial routes have been found to enable natural gas to be paid for in rubles.
The higher temperatures in Europe, in combination with solar and wind energy, result in a relatively limited demand for gas during this period. The supply of LNG tankers from the United States, among others, continues well. The catch may be that a rise in gas prices is also expected in the US, because gas consumption is also increasing there. Not so much to heat households, but rather to cool them. Gas supplies in the Netherlands have been reasonably replenished in the recent period to 34% of the available capacity.
Analysts expect that the gas price may slowly decline in the coming period, especially if traders' emotions regarding political tensions continue to deteriorate in the market. However, the gas price remains far from the stable level of around €20 to €25 or lower per MWh before 2021.