FX.co ★ TTF Prices Rise on Worries Ahead of Heating Season

European natural gas futures experienced an increase of over 2% to reach €32.5 per megawatt-hour on Thursday, following Russia's assault on Ukraine's gas infrastructure. This event has led to a substantial reduction in gas output, cutting nearly 60% of Ukraine's production this month. Consequently, private producer DTEK was compelled to cease extraction activities in Poltava, and operations at the state-owned Naftogaz have been severely disrupted, leaving several employees injured. As the heating season commences, European gas markets have been jolted by the attacks, with gas inventories remaining below historical averages. While imports from LNG and Norwegian pipelines have provided some relief from the reduced Russian gas flows, the diminished demand from China concerning Russia’s Arctic LNG 2 plant has allowed for a reallocation of the global supply. Current EU storage levels are at 83% of capacity, a decrease from the 93.2% recorded the previous year, causing traders to approach the situation with caution amid the rising winter consumption.