European natural gas futures were mixed on Monday, with traders eyeing supply disruptions from gas suppliers in the region amid rising inventories.
Europe’s benchmark natural gas futures have turned volatile after recording their biggest drop since May last week. The Norwegian Troll field and the Nyhamna gas processing plant are expected to end seasonal maintenance in the coming days.
Maintenance work has been extended several times over the past month, exacerbating supply constraints and driving prices higher. But at the same time, natural gas demand remains relatively weak and inventories continue to build, helping to drive down gas prices.
Inventories in continental European gas storage are more than 79% full, compared with a five-year average of 64% for the same period. Industry watchers expect prices to fall further when inventories are filled.
Analysts at Energy Aspects expect Europe could reach its gas storage target by early September, which could lead to a supply glut throughout October.
