According to Goldman Sachs, natural gas prices will fall 30% in the next months due to mild weather and an increase in supplies. This helps to alleviate fears of a winter crisis.
According to Wall Street Bank, benchmark European prices are expected to drop to EUR85 per megawatt – hour in the first quarter of 2023 from their current level of EUR120.
This is because unseasonably warm temperatures delay the heating season. Meanwhile, a glut in liquefied natural gas (LNG) shipments to Europe has allowed countries to replenish storage sites.
This has helped to ease concerns about blackouts and shortages this winter with prices falling from their August peak of EUR340.
Natural gas prices will slump 30% in the coming months as mild weather and a rush of supplies help to ease fears about a winter crisis, according to Goldman Sachs. They expect benchmark European prices to fall to €85 per megawatt-hour in the first quarter of 2023. pic.twitter.com/mSSdvbSjst
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Further falls in wholesale prices could also lead to lower energy bills, which would provide relief for squeezed households as well as businesses.
Goldman however warned that prices will rise again next winter as countries attempt to replenish storage sites for the winter. The benchmark is expected to rise to just below EUR250 by July’s end, according to Goldman.
