European Gas Extends Drop With LNG Helping to Ease Supply Fears

Benchmark futures fell as much as 2.7%, with monthly imports of liquefied natural gas into northwest Europe set to jump more than 25% from a year earlier. Prices subsequently recouped some of that loss as Russia suggested a cross-border gas point attacked last week would require lengthy repairs.

Prospects for talks to end the war in Ukraine have largely pushed prices down this month, with traders speculating a breakthrough could eventually bring back some Russian flows. Yet uncertainty over the future of the three-year conflict persists, and gas prices have moved sharply on small developments.

Russian Deputy Prime Minister Alexander Novak said Wednesday that the Sudzha metering point near the border with Ukraine, part of a link that sent fuel to Europe until recently, sustained significant damage, Tass reported. The attack last week sent prices up as much as 6.2%.

Traders remain jittery following a rapid depletion in Europe’s gas inventories this winter. But with just a few days left of the official heating season, some countries have started replenishing underground storage as rising temperatures ease consumption.

Lower LNG demand from China is also providing near-term relief for European buyers who compete with Asia for shipments. Chinese purchases are forecast to fall this year for the first time since 2022, according to BloombergNEF.

Dutch front-month futures, Europe’s gas benchmark, traded down 1.9% at €40.78 a megawatt-hour as of 5:30 p.m. in Amsterdam.