Gas Price Bounces Up Despite Mild Weather Forecasts
The European gas price rebounded somewhat on Friday, despite expectations that the mild winter weather in large parts of Europe will continue for the time being.
The fuel price has recently fallen sharply because less gas is used to heat homes and offices and stocks remain well-stocked as a result. Since Thursday, however, the gas price seems to be rising again.
The important Norwegian energy group Equinor has already warned that the European gas market will remain tight this year, so prices can fluctuate strongly. This shortage is caused by the fact that less Russian gas is available, and countries are fighting fierce competition to import liquefied natural gas (LNG) to maintain stocks.
On the leading Amsterdam gas exchange, the price rose by more than 3 percent around noon on Friday to 74.75 euros per megawatt hour. However, earlier in the morning, the price fell by 4 percent to 69.50 euros. On Thursday, the gas price rebounded after an initial drop of 60 euros. Therefore, every week, the gas price seems to remain virtually unchanged.
The gas price has halved since the beginning of December and is well below the peaks of around 350 euros that were reached at the end of August. However, despite the decrease, gas is still much more expensive than in recent years, when less than 30 euros per megawatt hour was paid.
According to weather forecasts, mild temperatures will likely continue next week, with much higher than average temperatures for France and Germany, the eurozone’s two largest economies. High energy prices have been a significant driver of high inflation in the euro area, and the unexpectedly low demand for gas is fueling optimism among European authorities.
“We are very optimistic now, and we were not in the fall,” Klaus Müller, president of the German network regulator, said in an interview with TV channel ARD. According to Müller, a gas shortage this winter is “unlikely”. “The more gas we have in storage facilities at the beginning of the year, the less stress and expense we will have to refill them for next winter.” In Germany, the gas storage facilities are almost 91 percent full, and the European storage locations are 83 percent full.