The price of gas in Europe fell to a 2-year low
The Dutch wholesale natural gas price for next month fell to a two-year low on Friday morning, which could offer some relief to consumers and some businesses that have been paying high energy bills over the past year, Reuters reported. Prices on the Dutch stock exchange are a reference for trading in Europe.
The Dutch June gas price fell to 24.90 euros ($27.41) per megawatt hour, the lowest level since May 27, 2021.
The highest values were reached around €340/MWh in August 2022 amid the European energy crisis and the suspension or reduction of Russian gas supplies.
The crisis sent gas and electricity prices soaring last year, burdening consumers and some businesses with very high energy bills, causing some industries to curtail production.
Subsequently, European wholesale gas prices have started to decline this year due to a milder than normal winter, measures to reduce gas consumption and healthy levels of gas storage and supplies.
Market analysts at ANZ said Europe had managed to avoid severe gas shortages amid mild temperatures and abundant LNG supplies.
Gas consumption in Europe between August 2022 and March 2023 was 17% lower than the average for the same period in the previous five years, they said.
Analysts believe that Europe will survive another winter without significant disruptions in energy supplies, but they also express some caution.
“In our view, Germany and the wider region could experience gas shortages next winter if demand is not reduced by a further 15%,” they added.
Meanwhile, UK benchmark wholesale gas prices have almost halved since the start of the year, allowing the country’s energy market regulator Ofgem to cut the cap on household energy bills by almost 40% since July.
However, the price drop for most British households will be around 17%, as since October they have been protected by a government guarantee to keep average annual energy costs at £2,500 ($3,155) a year to help reduce of living expenses.
