European gas prices up about 120% since start of the year
Low inventories and higher demand from heatwaves and reduced nuclear/hydro output are putting upward pressure on European gas prices ahead of winter.
Wholesale gas prices in Europe have risen by about 120 percent since the start of the year, driven by low storage levels and supply risks that could put the market under additional pressure ahead of winter.
Heatwaves and record temperatures have increased electricity demand, while reduced output at nuclear and hydro plants has been replaced by gas-fired power stations precisely at the moment when gas storage facilities should be filling up.
The pressure is already visible in trading: the European reference price on the Dutch TTF market climbed roughly 120 percent since the start of the year, reaching €63.7 per megawatt-hour on 18 August.
Storage shortfalls and regulatory timetable
Although current prices remain well below the record peak of €350 per megawatt-hour reached during the energy crisis in 2022 after Russia's invasion of Ukraine, many countries are entering the refill season with inventories below normal for this time of year.
European gas storage sites were only about 57 percent full at the start of August. Under EU rules, storage must be filled to at least 90 percent of capacity, but member states are allowed flexibility to hit that target between 1 October and 1 December, with further derogations possible in severe market conditions. Compared with 2021, Europe has cut gas consumption by roughly 15 to 20 percent.
Photo: press material from the event
