As Norway's supply is once again at risk, Europe's benchmark gas price closed at its highest level since the beginning of April.
Futures contracts have risen 12% in recent months, having previously hit 45 euros. The October contract, which expires this week, is currently the most actively traded, so its trend is sensitive to bullish factors.
Engie EnergyScan analysts wrote in a report that “short recovery above the level of €40 per MWH” may continue to provide support before the option expires.
Production cuts at Norway's Skarv oil and gas field and new problems at the large Troll gas field all exacerbated Monday's gains. Additionally, consulting firm Zenergi said that with the European heating season officially kicking off, next month marks the beginning of a new year for natural gas, so the last week of September tends to be bullish.
“Demand weakens at a time when European gas inventories are high and the threat of economic recession intensifies. This may put pressure on global gas prices in the short term,” said Henik Fung, an industry research analyst at Bloomberg. “In the context of China's economic faltering recovery and Australia reaching an agreement to end the strike, market concerns about disruptions in gas supply in the coming winter may be alleviated.”