(Bloomberg) -- Natural gas prices in Europe fell for a fifth session, with an outlook for mild and windy weather later this month helping to shield inventories from faster depletion.
Benchmark futures closed 3.5% lower, the biggest drop since late October. Storm Darragh swept through the UK during the weekend, boosting wind power generation and reducing the use of gas in electricity production.
Temperatures in the northwest are forecast to rise and wind generation is expected to increase again toward the middle of the month, following a brief cold snap in the coming days. Meanwhile, European imports of liquefied natural gas last week hit the highest level since January.
“The weather outlook has been revised warmer over the weekend with the return of above-average temperatures expected next week across Europe,” analysts at Engie SA’s EnergyScan wrote in a note.
Some LNG cargoes experienced delays in Wales over the stormy weekend, but one vessel is now unloading and four more are scheduled to arrive this week, according to ship-tracking data compiled by Bloomberg and port data.
At the same time, Asian demand remains muted. Top-consumer China may resell more LNG cargoes due to tepid industrial demand domestically and higher spot rates that make re-export more profitable, according to a note by leading private Chinese importer ENN Group.
Dutch front-month futures, Europe’s gas benchmark, settled at €44.86 a megawatt-hour. The UK equivalent closed 3.8% lower.
©2024 Bloomberg L.P.