FX.co ★ TTF Prices Fall on Friday, Set for Best Month Since 2023

European natural gas futures experienced a decline of over 3%, settling at approximately €38.5 per megawatt-hour (MWh) on Friday. This decrease is attributed to improving supply conditions, though the contract remains significantly elevated for the month overall. Earlier disruptions to U.S. LNG (liquefied natural gas) flows caused by storms were resolved as milder weather enabled export facilities to resume and boost production levels. This development alleviated some of the immediate supply concerns for Europe, which heavily depends on U.S. LNG imports. Despite this relief, January is expected to conclude with a robust 37% increase in prices — the most substantial monthly escalation since June 2023. This surge is largely due to enduring cold weather and rapid energy reserve depletions. Currently, European gas storage facilities are about 43% full, marking one of the lowest levels for this period in a year when compared to 2022, underscoring a precarious supply equilibrium. The January price hike stemmed from temporary production halts in the U.S. during winter storms and widespread apprehensions regarding global supply stability. Additionally, geopolitical tensions in the Middle East, particularly uncertainties surrounding Iran, have contributed to sustained risk premiums.