Member states are tapping into energy reserves as demand for heating grows, the media report
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Natural gas prices in Europe rose over the week due to strong demand because of cold weather with benchmark futures soaring by 8%, Bloomberg reported on Friday.
Although prices have fallen from summer peaks due to plentiful LNG supplies which helped Europe build up its stockpile, they are likely to start climbing again.
Dutch TTF natural gas futures for next month rose by 1% to €125 per megawatt-hour and Dutch January contracts rose to €128.30, Refinitiv Eikon data showed.
The demand for heating spurred by winter temperatures keeps pushing prices up and has prompted EU countries to start pumping gas from their storages. Reserves in Italy have already dropped to 93.5% from 95.4% as the country faced higher demand in November, the outlet says.
READ MORE: OECD predicts how ‘energy shock’ will affect Eurozone
On Thursday, the European Commission outlined limits for using gas this winter saying that EU storage facilities should be at least 45% full by February 1.
However, experts warn that the situation remains challenging as a rapid surge could deplete stocks and expose the market to supply disruptions.
Uncertainty around Russian flows via Ukraine is another factor that is expected to support higher prices. On Tuesday, Gazprom warned it may curb supplies through Ukraine’s pipeline network to Moldova from November 28th, after accusing Kiev of siphoning gas destined for the eastern European country.
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