European gas prices fall amid warm January temperature
Key takeaways:
- Need for heating in the UK and elsewhere drops, but concerns stay over supplies this winter.
- Last week prices fell to levels not experienced before the beginning of the battle in February 2022.
A bit of mild temperature in the UK and Europe has sent wholesale gas prices falling in a break from the high prices that have led to skyrocketing energy bills.
European costs for delivery in February tumbled by 4.3% to €73.7 a megawatt hour while UK prices decreased by 3.8% to 179p a therm.
Mild weather in the UK and gas prices drop:
A recent milder climate has decreased demand for heating in the UK, and the remaining of Europe and conditions are predicted to remain calm for the next two weeks.
The situation has raised optimism over gas supplies, which have been pushed since Russia reduced gas exports to Europe after it raided Ukraine. Last week prices fell to levels not undergone before the beginning of the battle in February 2022.
Europe struggle with shortages:
European countries rushed to fill up gas warehouse facilities amid fears of deficits this winter. They have made good improvements, creating positivity among retailers and reducing prices. Traders also bet a possible global recession would slash energy demand this year.
However, worries remain over how Europe will replace Russian gas imports in the forthcoming year, meaning prices will probably stay high against historical standards.
