EU gas storage withdrawals have slowed recently. However, storage levels remain well below historical averages. Meanwhile, US gas demand continues to rise. UBS reports that as of February 25, European gas storage levels stood at 40% (41 bcm). This marks a 3% week-on-week decline. Despite the decrease, the withdrawal pace has eased compared to the previous week.
According to UBS, EU gas storage withdrawals dropped to -2.8 bcm from -4.8 bcm in the prior week. However, this rate is still higher than the -1.6 bcm recorded a year ago. The primary reason behind this trend is increased LNG imports, which have helped stabilize the market.
UBS estimates that EU gas demand has remained stable month-on-month in February. Yet, it has increased by over 25% compared to the same period last year. By the end of March 2025, European gas storage levels are expected to be at 35%.
While Europe experiences a slower withdrawal pace, the US faces a different scenario. The US Energy Information Administration (EIA) reported a significant stock withdrawal of 261 Bcf. This figure is slightly below the market expectation of -266 Bcf. However, it remains well above the -60 Bcf draw recorded in 2024.
UBS attributes the strong demand to increased feedgas flows into LNG export plants. Additionally, a cold snap has driven heating demand higher. As a result, US gas demand remains robust, impacting supply dynamics.
EU gas prices have declined due to milder weather and relaxed storage targets. Similarly, US Henry Hub prices have fallen below $4/mmBtu following forecasts of warmer temperatures.
Despite the current price drop, concerns persist in Europe. Higher gas injections are expected during summer. Moreover, uncertainty regarding Russian gas supplies remains a key issue. To address long-term security, the EU is exploring investments in LNG projects and joint gas purchases.
For more insights on global gas market trends and trading opportunities, visit our website: FIXIO Markets.
EU gas storage withdrawals have slowed, but levels remain low. Meanwhile, US gas demand surges. Learn more about market trends.
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