BAKU, Azerbaijan, February 24. Europe’s natural gas market has faced a volatile start to 2025, with prices reaching their highest level in two years earlier this month, adding pressure on businesses, consumers, and governments across the region, according to the International Energy Agency (IEA), Trend reports.
The main European gas benchmark, the TTF, currently stands at around EUR 47/MWh (USD 14.50/MBtu). While this remains well below the peaks seen in 2022 following the Russia-Ukraine war, it is still roughly double pre-crisis levels.
The IEA attributes the rise in prices to several factors, including the halt of Russian gas transit through Ukraine since January 2025 and a return to average winter temperatures after two milder seasons, leading to increased gas withdrawals from storage. Additionally, a prolonged period of low wind speeds and limited sunlight in November - known as Dunkelflaute - resulted in an 80% increase in gas consumption compared to the same period in 2023.
Global gas markets also remain tight. The IEA expects LNG supply to grow by 5% in 2025, up from 1.5% last year, mainly due to the expansion of North American LNG facilities. However, this increase is partially offset by the loss of Russian pipeline gas supplies to Europe.
Gas storage levels in the EU are now 24 bcm, or 36%, lower than this time last year. The IEA warns that refilling storage ahead of the next winter will require significantly larger gas inflows than in previous years, increasing Europe's reliance on global LNG markets and adding further pressure to prices.