In almost 3 weeks low gas prices – Rise over 400% this year

European gas prices fell for a sixth day, the biggest drop in more than a year, according to Bloomberg, as liquefied natural gas (LNG) shipments headed for Europe as industrial padlocks and warmer climate restrict demand.

It is noted that a fleet of American LNG cargo is headed to Europe, while several ships sailing to Asia are now moving to the region. Most of the supplies come after record prices earlier this month forced factories to halt or slow down production, reducing demand as Europe faces unusually high temperatures for the season.

European gas prices have risen more than 400% this year, with Russia restricting flows at a time when demand is recovering. While prices have fallen over the past week, they are still more than five times higher than the average of the last five years. The relief of LNG loads may be short-lived, as geopolitical tensions and Russian pressure to approve the Nord stream 2 pipeline to Germany keep traders alert.

“Europe’s gas problem may not go away next year,” said Andrew Hill, head of European gas analysis at BloombergNEF.

In the Netherlands, the gas contract for next month was trading at 96.22 euros per megawatt hour, and then moved to 97.50 euros at 09:51 am. in Amsterdam. In the United Kingdom, prices fell as much as 12% to 235 pence per unit heat, the lowest level since 7 December.

LNG supplies are already reaching European networks. Flows from the Isle of Grain and Milford Haven terminals in the UK have risen more than 20% since December 24, according to the National Network. Flows to other European ports are also set to rise, with the number of US cargo heading to European ports rising by a third over the weekend.

Europe is also attracting more supplies, as Asia’s biggest buyers choose to use their stocks this winter instead of supplying more shipments.

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