European natural gas: Tight storage supports prices – ING

ING’s Warren Patterson notes that European natural gas prices have held up better than Oil as LNG supply recovery has been modest and Middle East flows remain disrupted. Heatwaves have boosted demand, leaving EU storage just above 50%, well below the five-year average. ING expects European natural gas prices to stay well-supported through the 2026/27 winter despite some potential El Niño relief.

EU gas prices seen well supported

"European natural gas prices held up better than oil prices following the MoU [Memorandum of Understanding], with the LNG supply recovery more modest. Also, the ramp-up of LNG plants in Qatar will also take time. QatarEnergy has extended the force majeure on some supply until early September."

"As a result, EU gas storage remains tight, having only recently passed the 50% level, well below the five-year average of 66% full at this point in the year. It's looking as though it will be difficult for the region to hit even the lowest target of 75% under EU rules."

"El Niño conditions may mean a milder start to the 26/27 heating season, which would offer some relief to the market, but this isn't guaranteed."

"We expect European natural gas prices to remain well-supported until the end of the 2026/27 winter."