The price of European gas on international energy markets has continued to fall. On Monday, gas futures on the Dutch TTF dropped by nearly 7% to 175 per megawatt hour.
This is the lowest level recorded since 25 July. However, compared to the annual average for this period, prices are still seven times higher than usual.
It would seem that measures taken at the European level to counter high energy prices are beginning to have an effect. Major energy consumers across the European Union are rapidly reducing their reliance on Russian gas while the European Commission has set out new price caps to control run-away prices.
Across Europe, governments are preparing massive energy interventions to lower prices for households and businesses. In Germany, the government has decided to take over the activities of Russian oil company Rosneft within its borders and is also considering buying three major gas companies.
In the United Kingdom, the government is preparing a £40 billion plan to halve energy costs for companies. France also aims to keep the price of energy for consumers under control.
However, with cold temperatures on the way, energy providers are expecting an uptake in demand for gas in the coming weeks.
Traders are carefully observing the level of gas currently in underground storage within Europe. The EU exceeded its 80% gas storage capacity target at the start of September, which has since risen to around 86%.
Yet experts warn that the gas stored will not be enough to weather the winter, stressing the need to curtail demand. EU Member States have pledged to reduce their demand for natural gas by 15% from August to the end of March 2023.
Other drastic measures may still be needed to reduce reliance on natural gas this winter, including massive cost savings and modernisation of certain buildings.