Global natural gas benchmarks hit multi-week highs, driven by a sharp increase in demand due to colder weather, intensifying withdrawals from the region’s already-depleting storage facilities. As the energy landscape continues to shift, the market is experiencing heightened volatility, with European gas futures and global natural gas prices surging in response to mounting supply concerns. Traders looking to capitalize on these market movements can use the YaMarkets broker trading platform, specializing in natural gas futures trading to stay ahead of the market.

Gas Prices Surge Amid Rising Demand

Futures on the European benchmark Title Transfer Facility (TTF) in Amsterdam soared by as much as 4.5% to €58.50 per megawatt hour—the highest level since February 2023 in yesterday’s session. Similarly, in the UK, the front-month contract climbed to 142.20p/therm, mirroring the two-year high. Meanwhile, natural gas prices on COMEX have jumped nearly 15% since the beginning of February, reflecting broader global supply pressures.

A prolonged period of cold weather across north-west Europe is expected to further increase heating demand, resulting in additional withdrawals from storage. Currently, European gas storage facilities are just 49% full—significantly lower than the 67% recorded at this time last year—raising concerns over potential shortages if cold temperatures persist.

Strained Storage and Tightening Supply

Europe has largely managed to navigate two consecutive winters since Russia’s full-scale invasion of Ukraine by shifting its reliance from Moscow’s pipeline gas to liquefied natural gas (LNG) imports from other global suppliers. In 2023, LNG accounted for approximately 34% of Europe’s gas supply, up from just 20% in 2021.

However, this winter has seen more aggressive storage drawdowns due to severe cold spells and increased competition for LNG from Asia. By mid-December, gas storage levels had already fallen 19% since the end of September, compared with single-digit declines over the same period in the past two years.

Adding to the pressure, the remaining Russian pipeline gas supply via Ukraine—which accounted for roughly 5% of Europe’s gas imports—has ceased entirely since the start of 2025. This has left Europe’s gas market in an even more delicate balance, with traders closely monitoring weather patterns and LNG availability. For traders, understanding these supply dynamics is crucial, and YaMarkets broker trading platform offers real-time insights and tools for natural gas futures trading to make informed trading decisions.

Weather and Geopolitics Fuel Price Volatility

With forecasts predicting simultaneous cold snaps across Europe and parts of north-east Asia later this week, the competition for LNG cargoes is expected to intensify.

Meanwhile, global LNG trade dynamics are facing a fresh shake-up after China imposed a 15% retaliatory tariff on US LNG imports in response to President Donald Trump’s 10% tariff on all Chinese goods entering the US. This emerging trade war is expected to cause a reorganization of trade flows, with Chinese buyers likely redirecting their contracted US LNG to other markets.

However, for now, European buyers remain the primary destination for US LNG cargoes, ensuring that supply disruptions due to tariffs may have minimal direct impact on Europe.

Looking Ahead: Risks and Market Outlook

As Europe grapples with tightening supply conditions, further price volatility is likely in the weeks ahead. If cold weather persists and LNG competition with Asia intensifies, prices could see further spikes. The ongoing rebalancing of global gas trade flows and geopolitical tensions only add to the uncertainty.

As the European energy market remains finely poised, all eyes will be on weather forecasts, storage trends, and LNG supply shifts to determine the next move in gas prices.

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Risk Disclaimer: Trading in financial markets involves substantial risk and may not be suitable for all investors. Prices are subject to volatility, and past performance is not indicative of future results. Ensure you understand the risks involved before participating in natural gas futures trading.