Natural gas prices in Europe exceeded $2,500/tcm for the first time since the beginning of March

Front Month natural gas futures prices (September-booked resource) on the Dutch TTF hub during trading on August 16 exceeded $2,500/tcm. Thus, prices reached the highest level since the beginning of March, when Europe saw a sharp increase after the Russian invasion to Ukraine.

Natural gas prices in Europe reached €238/MWh, 8.5% higher than the previous day's closing level. At the time of transfer, the price exceeded 110,000 UAH/tcm (including VAT), more than twice the prices on the Ukrainian market.

The main reason for the increase in gas prices in Europe is the reduction of gas supplies from all directions to the lowest level since the beginning of the year (see details in ExPro Gas Daily).

In addition, Europe's record drought has reduced hydropower generation, leading to historic highs in EU electricity market prices. This, in turn, contributed to an increase in the demand for gas for electricity generation.