EurOil: European gas outlook improves, but further winter risks ahead

Europe managed to survive last winter without rolling blackouts or heating failures, despite gloomy predictions, most notably from Moscow. Since then, natural gas prices have fallen to levels not seen in two years, and the continent looks increasingly well positioned to make it through next winter as well, given the fast rate at which gas storage volumes are being replenished.

Such a marked improvement in fortunes should not lead to complacency, however. As the International Energy Agency (IEA) head Fatih Birol and others have said, Europe is “not out of the woods yet.” Front-month gas prices are much lower than they were at the height of the crisis in August last year – more than 90% lower in fact. But they are still 50% higher than what was considered the norm prior to the COVID-19 pandemic. 

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