European and UK wholesale natural gas prices moved higher on Thursday as October and the fourth quarter began, with storage levels and developments in the Middle East remaining in focus.
The benchmark Dutch front-month natural gas contract rose 1.0% to €73.10 per megawatt-hour, remaining close to recent multi-week highs.
In the UK, the equivalent day-ahead wholesale gas contract increased 0.7% to 184.00 pence per therm.
European Winter Heating Season Begins
The increase in gas prices coincided with the start of the European winter heating season, when seasonal demand for heating typically begins drawing on stored gas supplies.
According to Gas Infrastructure Europe data, underground storage facilities across the European Union are around 12 percentage points below their levels at the same point last year.
European buyers also continue to compete with Asian markets for seaborne liquefied natural gas cargoes, with Asian spot prices affecting competition for winter LNG supplies.
Middle East Developments Remain in Focus
Energy markets continued to monitor developments in the Middle East, including stalled negotiations between the United States and Iran and uncertainty surrounding the Strait of Hormuz.
Brent crude prices remained elevated, coinciding with higher prices across parts of the broader energy market.
The combination of lower year-on-year European gas inventories, competition for LNG cargoes and uncertainty affecting global shipping routes leaves regional supply conditions sensitive to changes in winter demand.
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