The spot price of gas in Europe has updated the two-year minimum

The spot price of gas in Europe has updated its minimum value for 2 years, falling below the level of $300 per thousand cubic meters ($298.2). Analysts note that during this period there is always a decrease in quotations to the minimum values, since May month is at the junction of the heating and air conditioning seasons.

Gas prices in Europe have declined to the level of June 2021 amid an oversupply and forecasts of a hot summer. Additional downward pressure on prices could be exerted by the first joint tenders for the purchase of gas by EU countries, as well as an increase in the share of wind generation in electricity generation.

Recall that a year ago, in the early spring of 2022, the cost of gas in European countries was in the region of $3,900 per thousand cubic meters.

Currently, Europe continues to pump gas into its underground storage facilities. The current stock level is 66.48% – and this is 18 percentage points higher than the average in the same period over the past five years. Experts predict that if this intensity is maintained throughout the summer, by the end of September it will be possible to achieve the target level of 90% of storage capacity.

However, Russian Gazprom warns that it will be very difficult to do this, since the political decisions of the European authorities are aimed at refusing to import pipeline gas from the Russian Federation. In this regard, competition for LNG will have a big impact on the volumes of gas available on the European market.