(Montel) European gas prices dropped on Thursday morning amid rising supply and a mild weather outlook.
Europe’s benchmark TTF front month was last down EUR 0.12 on the day at EUR 46.92/MWh on Ice Endex.
“Volumes are flowing at peak winter levels and winter hasn't even started yet,” said Ira Joseph, global fellow at the Center on Global Energy Policy, Columbia University, on the social media platform X.
While the UK was drawing higher volumes due to a lack of storage volume, around 70-80% of total Norwegian exports were still going directly to Europe, he added.
Exports from Norway, the EU's biggest gas supplier, last stood at 339.9mcm/day, the highest level for this week and compared with only 319.1mcm/day on Monday morning, data from network operator Gassco showed.
Analysts at Energi Danmark pointed to a still warm and windy outlook which will dampen gas demand in the power and heating sector and high storage levels.
Temperatures in Germany, Europe’s biggest gas user, are expected to average at 5.2C next week, which would be 1.3C above the norm, while wind power output is seen at 26.8 GW, 7.8 GW higher, according to data from Montel’s Energy Quantified (EQ).
Tom Marzec-Manser, an Icis gas analyst, said that gas demand in the EU and the UK in the first half of November was 4% higher than the same time last year, but still down 24% against the 2017-2021 average for the same period.
European gas storage facilities were last seen 99.4% full, amounting to 1,133 TWh, largely unchanged from the day before, data from Gas Infrastructure Europe showed. Storage levels in the UK stood at 101.6%, representing 125 TWh.
Gas storage facilities can exceed their capacity limit if the technical conditions for storage, such as the temperatures, are optimal or if the calorific value of the stored gas is higher.