Energy Icy cold causes European gas prices to rise
European gas prices have recently risen sharply. The new heavy dependence on the USA also plays a major role in this. The decisive factor in the short term is how cold it will be as the winter progresses.
23.01.2026, 10:59
SDA
As recently as November, a global increase in the supply of LNG (liquefied natural gas) and hopes for an end to the war in Ukraine had caused prices to fall. Since then, however, the focus has been on low gas storage levels in combination with the cold winter in the northern hemisphere. With temperature forecasts well below the norm - especially in the USA - European natural gas has also risen in price by around 40% in the past two weeks or so.
The benchmark futures contract for a gas delivery in the following month on the Amsterdam exchange rose above the EUR 40 per megawatt hour mark this week, the highest it has been since June 2025. However, trading had already seen record prices of over €300 during the 2022 energy crisis due to the war in Ukraine.
Low gas storage levels
Meanwhile, US gas prices rose "to their highest level since 2022 due to fears that the freezing cold could jeopardize the country's supply", says Simon Lustenberger, Head of Investment Strategy at ZKB, when asked by the news agency AWP.
Experts also point out that gas storage levels in Europe are at a very low level - around the same level as in 2022. And they are likely to fall even further due to the cold spells in the coming weeks. Europe will have to import more LNG in the coming months than in recent months in order to refill the storage facilities.
According to data from the industry association Gas Infrastructure Europe, gas storage facilities in the EU are currently just over 48% full. The fill level is therefore below the long-term average of just under 61 percent.
In the (stranglehold) of the USA
However, there is a risk that US President Donald Trump will use gas supplies to Europe as leverage in the dispute over Greenland: Europe has replaced Russian pipeline gas with LNG imports due to the war in Ukraine, which are increasingly dominated by the US, writes Jonathan Schroer, energy strategist at Unicredit, in a commentary.
Qatar and the USA in particular are likely to be the largest suppliers of liquefied natural gas in the coming years. However, in view of the confrontation with the USA over Greenland and the tariff dispute, there is now growing concern in the EU that it may have merely switched its energy dependency from one unpredictable power to another.
The decisive factor for the further short-term price development is now how much heating will be needed as the winter progresses: "Price sensitivity to weather forecasts remains extremely high," says Christian Burghardt from Swiss energy service provider Ompex to AWP.
Interplay of many factors
However, temperature forecasts are only reasonably reliable within a horizon of one to a maximum of two weeks, according to the Bern-based energy company BKW. "So it can 'get wild' or 'get boring' - you can't know yet." But: "As soon as warmer weather is in sight, gas prices in the USA and Europe are likely to fall significantly again," says Lustenberger from ZKB.
In the medium term, a renewed escalation of the Iran conflict or a ceasefire and/or peace agreement in Ukraine would drive up the price or reduce the risk premium, says Burghardt from Ompex. According to him, other influencing factors in the long term are industrial gas demand in Europe and LNG demand in Asia. In the latter continent, the decline in demand for LNG in China in particular has recently caused prices to fall.
In addition, the electricity market is also setting the pace for the gas market. In view of the decommissioning of nuclear and coal-fired power plants, gas "often has to step in when electricity demand is high and renewable generation is low," says Alex Pashley, gas analyst at Axpo.
