FX.co ★ TTF Prices Rebound on Demand Expectations

European natural gas futures experienced an increase of over 1%, surpassing €35 per megawatt-hour, effectively breaking a three-day decline. This rise is attributed to the unusual heat wave sweeping across the continent, leading to heightened demand for cooling systems. Weather forecasts predict that temperatures will remain above average for the next two weeks, with cooling demand anticipated to reach its highest levels since July 2022. As both Europe and Asia enter peak summer conditions, the strain on global LNG supplies intensifies. Even though European gas storage levels have exceeded 50%, they are still significantly lower than typical figures, given that last winter concluded with storage at just 33.5%. The termination of the Ukraine transit agreement and consequent loss of Russian pipeline flows have made Europe increasingly reliant on liquefied natural gas (LNG), which has been relatively accessible due to weak demand from Asia. Nevertheless, supply has been slightly restricted due to planned maintenance in Norway.