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The benchmark natural gas price for Europe plunged by 11% at the opening in Amsterdam on Tuesday, extending this month’s loss to 20%, as wind generation is expected to recover and the current cold snap to end soon.
The Dutch TTF price traded at below $65 (60 euros) per megawatt hour (MWh) early on Tuesday after forecasts started to show that milder temperatures are coming next week in northwest Europe after the current cold snap. The warmer weather would persist through the first week of February, per forecasts from Maxar Technologies quoted by Bloomberg.
In addition, EU gas inventories are still unusually high for this time of the year – at 77% full across the EU and well above the five-year average for the winter heating season. The high volumes of gas in storage and the constant influx of LNG cargoes are easing supply concerns in the absence of most of the Russian pipeline gas.
Of course, milder weather so far this winter, especially at the end of December and the start of 2023, has helped a lot.
Last week, Europe’s benchmark gas prices rose for the first weekly gain in several weeks amid expectations of colder weather in the big gas-consuming countries in northwestern Europe.
Before that, prices had slumped to the level last seen before the Russian invasion of Ukraine. Mild weather, ample volumes of gas in storage sites, and continued LNG imports have dragged gas prices lower in recent weeks.
Toward the end of the winter heating season, the Freeport LNG export terminal in the United States could return to exporting cargoes after it was shut down following a fire in June.
Freeport LNG on Monday confirmed for Oilprice.com that repairs had been completed at its LNG export facility, and that a request to restart by introducing LNG to the piping system had been filed with regulators.
By Tsvetana Paraskova for Oilprice.com
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Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews.