European natural gas prices fall more than 8% as supply shortage fears subside

European natural gas prices fell during Monday’s trading after two consecutive days of gains, as unusually warm weather curbed demand and eased concerns about a winter supply shortage.

Higher temperatures above normal delayed the build-up of gas demand in the European region, allowing storage sites that were already more full than usual to continue filling.

Strong flows of LNG and lower industrial consumption also contributed to a sudden oversupply in the European market.

However, Claudio Descalzi, CEO of Italy’s Eni, said in comments reported by Bloomberg: “We have problems next year because in 2023 we don’t have Russian gas,” warning that the recent drop in prices may not continue.

Natural gas futures are still four times higher than the five-year average for this time of year, while the European Commission intends to take further measures to ensure the economy is protected from any further increase in energy costs, including capping prices.

And futures contracts for natural gas in the Netherlands for December delivery fell 8.25% to 127.60 euros per megawatt.