Commodities Economy Forex News

Global Demand for Natural Gas Increases, EU Prices Surge 1000% Since May


Asian markets have a significant impact on natural gas prices in Europe. There’s been a surge in gas demand since January 2021; this caused a spike in European spot gas prices during quarter one of 2021.  

Gas inventory dropped in the E.U. by 30% by the end of March 2021, lower than last March. This indicates an increase in consumption. The leading influencers of wholesale gas rates were the storage fullness rates. Also the availability of LNG, which was influenced by the Asian markets.

Cheap natural is something of the past, as energy becomes costly and will impact many industries worldwide. In the last decade, the cost of natural gas, which was in excess and affordable, was used for home heating and electricity generation. There was a surge in supply from the U.S. to Australia. 

However, this year, the demand surpassed the supply rate, which caused a sharp rise in prices, and  European gas prices reached an all-time high this week. Asian supply is also at an all-time high.

The greener alternative is not cheaper.

The reduced carbon footprint goals are increasing the reliance on cleaner fuels like gas to replace coal. In addition, investments made to achieve these goals are costing producers and therefore making energy more expensive.

Chris Weafer, CEO of Macro-Advisory, based in Moscow, said, “No matter how you look at it, gas will be the transition fuel for decades to come as major economies are committed to reaching carbon emission targets. The price of gas is more likely to stay elevated over the medium-term to long-term.”

The price of natural gas has surged over 1,000%, which is well above the record low in May 2020.  Asian LNG has spiked six times in the last year. In the U.S., the prices have also rallied to all-time highs.

With the global industries switching to cleaner energy and using gas as an alternative to carbon fuel, the anticipated demands will increase even further. 

Experts fear that an energy crisis is prevalent since there is a lack of funds to invest in expansion projects to meet global demands. More updates to be uploaded on MetaNews.


Justin N. Richards

Justin N. Richards is a Florida-based technical analyst, market researcher, educator, and trader. Justin began his career in Chicago in 2001 performing futures market analysis for floor traders at the Chicago Board of Trade and the Chicago Mercantile Exchange. He also worked for numerous brokerage firms during that time, all of which hold him in high regard, and he has been providing outstanding analysis services for traders worldwide ever since. Mr. Richards is an expert in the area of market patterns, price and time analysis as it applies to futures, Forex, and stocks. In addition to these talents, he provides educational services for investors looking to improve their analysis and trade skills. Justin has a B.A. in Business Administration from UCLA and an M.S. in Financial Markets and Trading from the Illinois Institute of Technology. Justin’s professional experience, education, and discipline, not only make him an exceptional analyst, they point him out as a reliable, hard working and intelligent business strategist who is dedicated to his craft.
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