European Natural Gas Prices Fall 3.2% to 34.53 Euros on LNG Supply

European natural gas prices have been declining, hovering around 35 euros per megawatt-hour. This downward trend is supported by a steady influx of liquefied natural gas (LNG) shipments, which has facilitated a smooth replenishment of reserves.

Following the long weekend, benchmark futures saw a drop of up to 4% on Tuesday. Despite some global LNG facilities remaining offline, the volume of LNG shipments arriving at ports has been slightly above the seasonal average, indicating a robust supply situation.

With the winter depletion of reserves, the focus has shifted to summer restocking. Initially, the price structure made storage economically unviable, but current prices show a small positive price differential, where far-month prices are higher than near-month prices. This could incentivize restocking in the coming days or weeks, although traders typically prefer larger price differentials.

Industry consultants have noted that warmer weather and ample LNG supply will also contribute to price stability. As of the afternoon, the Dutch near-month futures contract, serving as the European benchmark, fell by 3.2% to 34.53 euros per megawatt-hour.