European natural gas futures slumped below €50 for the first time in 17 months, indicating easing of the region’s worst energy crisis in recent times. Gas prices have plunged by more than 80 percent from their peak in August 2022, when Russia’s gas cuts hit Europe.
Benchmark front-month futures dropped as much as 4.8 percent to €49.5 a megawatt-hour by 8:28 a.m. in Amsterdam. Gas futures have lost about 35 percent in 2023.
The reasons attributed to the easing gas prices are being attributed to inflows of Liquefied Natural Gas (LNG) from the US to Qatar, relatively mild weather and reduced energy consumption. European nations appear to have adjusted with the replacement options now.
However, gas prices could still rise if there is extended cold weather orsupply disruptions from the US and Qatar.
“The market absorbs patches of demand appearing in Far East markets just as Europe remains unseasonably warm, windy and well supplied to meet a slowing demand profile,” said Tobias Davis, head of LNG for Asia at brokerage Tullet Prebon to Bloomberg.
-With inputs from Bloomberg
First Published: Feb 17, 2023 2:17 PM IST
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