The European gas market shows signs of recovery after a downturn.

Gas prices in Europe have risen due to improved outlooks

European natural gas prices have started to rise due to improved demand prospects for energy resources and activity from algorithmic funds ahead of voting on more flexible fuel storage rules.

Futures for the benchmark index rose by 2.6% on Thursday, recovering previous losses. Although recent volatility reflected concerns over the ongoing trade war and its impact on energy demand, signs of progress in reaching some trade agreements are mitigating worries.

Traders are also closely watching the European Union's voting on fuel accumulation rules aimed at reducing gas storage targets to 83% by November 1.

The European gas markets are feeling the effects of a cold winter, as gas supplies have significantly decreased, leading to speculation regarding the possibility of timely replenishment before the next heating season. However, the global fuel supply balance remains fragile, and replenishing storage will be a challenging task.

Trends in the hydrocarbon market in Europe

The European Union has plans to gradually phase out Russian energy by 2027, which has previously led to rising prices. The region will need to continue expanding other supply sources to offset losses from the absence of supplies from Russia.

One possible option is larger purchases of American liquefied natural gas, which is being discussed in trade negotiations. President Donald Trump is expected to sign a trade agreement with the United Kingdom at a press conference.

Competition with other gas buyers and heatwaves in Asia pose risks of price increases, but imports of liquefied natural gas to Northwestern Europe have slowed compared to the first week of April.

Dutch gas futures increased by 1.6% to €35.08 per megawatt-hour.

Analysis:

This news reveals the complex issues of the energy market in Europe and its dependence on external fuel supplies. The rise in gas prices and the search for alternative energy sources highlight the need for diversification and independence from individual suppliers. The role of trade agreements and cooperation between countries is crucial for ensuring market stability and supporting energy security.