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Wednesday, November 29, 2023
HomeTop Business NewsGas Prices Take European Markets on a Summer Thrill Ride

Gas Prices Take European Markets on a Summer Thrill Ride


European wholesale gas prices have been experiencing significant volatility on futures markets, which has raised concerns for the European Union Commission. This period of volatility can be traced back to the spike in energy prices following the invasion of Ukraine last year.

On Friday, wholesale gas prices for delivery in September on futures markets rose by 8.5%, while the contract for December increased by over 3%. This trend of large declines followed by substantial price gains has been observed in recent weeks. Traders have been assessing the risks associated with threatened strikes at an exports facility in Australia, which could impact liquified natural gas (LNG) supplies.

During the summer, prices had experienced a significant decline as EU countries successfully managed the winter without any shortages in gas supply. Despite European storage facilities being rapidly filled ahead of the next winter, recent price hikes have occurred. This situation is reminiscent of last year when the EU Commission became alarmed as gas prices soared to over €300 per megawatt hour, potentially burdening households and businesses with unaffordable energy bills.

The spot price of European gas had reached a low of €27 in late July before briefly surging to €43 last week. Jonathan Stern, a distinguished research fellow at the Oxford Institute for Energy Studies, commented that the European market is currently oversupplied until possible cold weather arrives. However, he also noted that this type of “rumour volatility” is likely to persist for at least another year.

Thomas Lyons
Thomas Lyons
Thomas, the founder and chief editor at Top Rated, harbours a deep-seated passion for business, news, and product reviews. His thirst for knowledge and experience has led him on a journey across the length and breadth of the country, enabling him to garner a wealth of insight. At TopRated.ie, his sole aim is to deliver meticulously researched news and provide impartial reviews of fact checked Irish companies, thus helping readers make well-informed decisions.


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