FX.co ★ TTF Prices Rise Toward 7-Week High

European natural gas prices have surged to over €29 per megawatt-hour, marking the highest point seen in nearly seven weeks. This increase is fuelled by several factors, including the threat of colder weather, reduced storage levels, and escalating geopolitical concerns affecting liquefied natural gas (LNG) supply. Although current forecasts suggest that temperatures will remain milder than usual over the next 10 days, predictions indicate a return to cold conditions as January comes to a close. Recent cold spells have already resulted in accelerated depletion of storage, leaving EU gas reserves about 54.9% full, significantly lower than approximately 66.9% this time last year. Additionally, geopolitical tensions have intensified following reports that the United States is contemplating military and cyber actions against Iran, sparking fears of potential disruptions to global LNG supplies. These concerns are especially pertinent for Europe, which has become increasingly reliant on LNG following the significant reduction of Russian pipeline gas. In a pivotal shift last year, LNG imports surpassed pipeline deliveries for the first time, underscoring Europe's heightened vulnerability to global supply disruptions.