FX.co ★ TTF Prices Rebound to 7-Month High

European natural gas futures have surpassed the €39/MWh mark, reaching their highest level since June, and are set for a weekly increase of over 6%. This surge is primarily due to significant withdrawals in January, reflecting tight supply conditions in the region. Throughout this winter, Europe has heavily relied on its gas reserves. The withdrawals have been occurring at the fastest rate in five years, driven by an unusually cold winter with an average daily usage of approximately 7.79 terawatt hours. However, LNG imports have been less than half of this, exacerbating the situation. As a result, stockpiles have dwindled to approximately 47.6% capacity, a notable decrease from the 58.4% recorded around the same time last year. This underscores a tighter supply forecast as another cold spell approaches. Critical storage facilities report even lower reserves, with Germany at 39.7%, France at 39%, and the Netherlands at 33.3%, whereas Italy and Austria have seen their reserves reduced to 62.6% and 51.5%, respectively. Further aggravating the situation, US gas supplies, initially intended for LNG export terminals, were redirected to fulfill rising domestic demand during an Arctic cold front, while colder weather in Asia has heightened the competition for LNG shipments.