 and low demand thanks to unusually warm weather has enabled Europe to fill storage facilities to about 95 per cent of capacity, easing concerns and leading to a sharp drop in prices){kind=link}
Gas prices in Europe will fall by as much as 30 per cent by early next year before rising sharply next summer, analysts at Goldman Sachs have predicted.
The investment bank now sees Dutch TTF gas prices falling to €85 per megawatt-hour in the first quarter, down from present levels of about €125 for the European benchmark month-ahead contract.
Prices hit more than €300 per megawatt-hour in August as Russia moved to cut pipeline flows to Germany, raising fears of supply shortages this winter.
However, an influx of liquefied natural gas (LNG) and low demand thanks to unusually warm weather has enabled Europe to fill storage facilities to about 95 per cent of capacity, easing concerns and leading to a sharp drop in prices in the last two months.
In a research note, Goldman Sachs economists said: “Gas prices dipped below €100 – driven by high inventory levels, strong LNG imports and mild weather – and our commodity team forecasts a further decline to €85 in [the first quarter] before sharply picking up into next summer as storage levels are rebuilt.”