European gas prices drop below €30 for the first time in two years

European gas futures slumped below €30 for the first time since June 2021, in a stark reversal of last year’s market chaos and a sign of tepid demand as Europe recovers from its energy crisis.

The region has amassed high stockpiles after a mild winter as it rushed to import liquefied natural gas and curbed consumption. Yet demand remains weak amid an uncertain economic outlook and a seasonal lull.

Prices are now less than 10 per cent of their peak levels after Russia curtailed supplies to the region in the fallout of its war in Ukraine. Still they’re near the five-year average, though many consumers are still reeling from the market shocks of the past year.

The recovery has been uneven across the region, and some gas users are still subject to energy contracts set when prices were higher – meaning there could be a lag in relief in power bills. Traders are also eyeing the prospect of higher demand for electric generation in the summer months. – Bloomberg