(Bloomberg) -- European natural gas prices eased as traders weighed a mild weather outlook and high inventories against the potential impact of a widening of the war in the Middle East.

Futures for December delivery fell as much as 4.9%, after closing Monday little changed. The escalation of the conflict has led to several weeks of sharp swings in intraday trading, with prices now about 20% higher than they were before Hamas’s attack on Israel on Oct. 7.

Europe’s energy supplies are on far more stable footing than they were at the peak of last year’s energy crisis, with stockpiles on the continent almost full and consumption still below historical averages. Still, the market remains vulnerable to supply disruptions after losing a large part of its previous flows from Russia.

Unseasonably warm weather is expected to extend across much of continental Europe well into the first week of November, according to forecaster Maxar Technologies Inc. As a result, the region’s heating season could be slow to take off, keeping gas consumption muted. 

At the same time, traders are closely watching for signs that the war in the Middle East might affect fuel flows to Europe via the Strait of Hormuz, a vital waterway for the transport of crude oil and LNG. 

Israel struck at Hezbollah in Lebanon and stepped up its ground operations in Gaza. Prime Minister Benjamin Netanyahu ruled out a cease fire, and dismissed calls for his resignation over his handling of the attacks by Hamas, which has been designated a terrorist group by Washington and European Union. 

Israel Latest: Military Strikes Back At Hezbollah in Lebanon

Dutch front-month futures, Europe’s gas benchmark, fell 3.9% to €50.99 a megawatt-hour at 8:45 a.m. in Amsterdam. The UK equivalent contract also fell. 

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