The European gas market is vulnerable to supply disruptions this summer as it relies heavily on supplies from around the world.
European natural gas prices continued to rise, reflecting growing concerns over fuel supplies amid geopolitical tensions. Bloomberg wrote this on Wednesday, July 31.
In particular, gas futures contracts rose 2.6%, reaching almost 36 euros per megawatt-hour (about $400 per thousand cubic meters). Prices rose for the fourth consecutive day as traders struggled to increase gas supplies ahead of the heating season.
Concerns about a possible escalation of conflict in the Middle East add to the risk at a time when traders are already facing stiffer competition from other major buyers of liquefied natural gas such as China and Egypt.
The European gas market has been vulnerable to supply disruptions this summer as it now relies heavily on supplies from around the world.
LNG flows to Europe were 30% below average in July, according to Bloomberg. Although regional storage facilities are filling up ahead of the heating season and flows from Norway are increasing, warm weather across much of the continent has boosted demand for air conditioning this week.
Meanwhile, the Austrian company OMV announced the reservation of new pipeline capacity through Germany to ensure its supplies in the event of further disruptions to Russian supplies. Austria and neighboring Slovakia remain the main European importers of pipeline gas after supply restrictions Gazprom in Germany and other countries.
“Short-term gas trading has changed,” said Marco Saalfrank, head of continental European trading at Axpo Solutions AG, adding that it is now more “emotionally driven.”
Note that in June, gas prices in Europe exceeded $420 per thousand cubic meters for the first time in the past six months.
Let’s remember that the media wrote that the Norwegian company Equinor, during the two years of the war in Ukraine, was able to almost completely replace the Russian one. Gazprom in the field of gas supplies in Europe.
It was previously reported that gas prices in Europe rose to their highest level since the beginning of the year.
Source: korrespondent
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