Dutch and British wholesale gas price weakened on Wednesday morning as milder and forecasts for windier weather limited demand and eased concerns over storage depletion.
The benchmark Dutch front-month contract at the TTF hub was down €0.74 at €29.70 per megawatt hour (MWh), or $10.30/mmBtu, by 09:01 GMT, its lowest level since January 12, LSEG data showed.
Milder forecasts for the weekend and remainder of the month, combined with a lower geopolitical risk premium, weighed on prices, said Arne Lohmann Rasmussen, chief analyst at Global Risk Management.
Progress in negotiations between Iran and the United States has also lowered the risk of a closure of the Strait of Hormuz and a disruption of liquefied natural gas (LNG) supplies from Qatar to the global market, he added. Still, Iran briefly shut down the key shipping choke point for military drills on Tuesday.
Forecasts of warmer weather are also helping ease concerns over low inventories, said Daniel Hynes, senior commodities strategist at ANZ Research.
EU gas storage sites were last 33 per cent full, their lowest since 2022, and 11 percentage points less than at the same time last year, Gas Infrastructure Europe data showed.
In Germany, storages are just 23 per cent full, the lowest level for the time of year since at least 2011, but this remains above legal thresholds and gas supplies are secure, the German economy ministry said on Tuesday.
Meanwhile, a continued increase in wind power generation should also limit gas demand for power generation, further improving the European gas balance, analysts at Engie Energyscan said.
The British day-ahead gas price was down 2.50p at 70.50p per therm. The Dutch day-ahead contract was up €0.67 at €30.60/MWh.
(Reporting by Nora Buli; editing by Nina Chestney)
