European Gas Prices Surge to Two-Month High

The European gas benchmark, the Dutch Title Transfer Facility (TTF), rose by over 4% in morning trading on Wednesday, reaching €32.52 per megawatt hour for February delivery. This increase marks a series of steady gains since January 8, with the indicator surging over 18% in the past week to hit a two-month high.

Key Drivers of the Price Increase

The price climb is primarily a reaction to two concurrent factors driving higher demand for gas. First, a spell of cold weather across the region has increased consumption from households for heating. Second, demand for gas in electricity generation has risen due to an ongoing nuclear outage in France. Operator EDF stated its Flamanville 3 nuclear facility will remain offline until the end of the month, with operations expected to resume on February 1.

Broader Market Context and Sentiment

The market context supports the price sensitivity. European gas demand is reportedly becoming "less price responsive" and more influenced by factors like weather and the availability of alternative power sources. Contributing to trading sentiment are falling inventory levels; data shows Europe's underground gas storage was 53% full as of January 12, significantly below the five-year average of 69% for this time of year. This occurs despite a record high for EU liquefied natural gas imports, which reached 145 billion cubic metres in 2025.