European Natural Gas Prices Can Fall as Winter Approaches: Bloomberg

European natural gas prices are likely to decline, despite competition from Asia for LNG cargoes and slower stockpile refilling compared to previous years, Bloomberg said.

• Robust inventory levels suggest that the first-winter contract may relinquish recent gains as it approaches maturity.
• Dutch TTF first-winter forwards have surged over 40% from February lows, but factors such as high US temperatures, Norwegian outages, and LNG competition may not justify sustained high prices.
• The rate of increase in European gas stockpiles on record since late April reflects the stiff competition for LNG, although Europe came out of winter with higher-than-usual inventories, allowing stocks to reach capacity by October.
• However, high US demand, potential supply disruptions from Norway, and potential sanctions on Russian LNG trans-shipments could affect the market, Bloomberg said.