Summary:
- Rising Natural Gas Prices in Europe
- European Central Bank Governor Says Interest Rates Will Reach Around 2% by Fall
Rising Natural Gas Prices in Europe
European natural gas prices surged on the first trading day of this year as the loss of a major supply route coincided with freezing temperatures in the northern region and an unplanned outage in Norway. Benchmark prices also climbed on Thursday, closing at their highest level since October 2023.
Russian gas deliveries via Ukraine ceased on New Year’s Day after the transit contract between the two warring nations expired without a replacement in place. While traders had anticipated the loss of Russian flows — a critical supply source for many Central European countries — this week’s supply constraints could lead to faster withdrawals from storage facilities that serve as a buffer.
The benchmark gas price in the Netherlands rose by about 4.3% and closed 2.8% higher at €50.27 per megawatt-hour at 6 p.m. in Amsterdam. Futures prices exceeded €50 on December 31 in anticipation of the halt in Russian flows.
European Central Bank Governor Says Interest Rates Will Reach Around 2% by Fall
European Central Bank (ECB) Governing Council member and Governor of the Bank of Greece, Yannis Stournaras, said in an interview with Greek radio station Skai on Thursday that the ECB’s key interest rate is expected to decline to around 2% by the fall of 2025. However, he noted that this forecast could be affected by unforeseen circumstances, highlighting risks in both Europe and the United States.
Many economists and investors expect the ECB to cut interest rates at each meeting through mid-2025 as inflation stabilizes at the 2% target, while the region’s economy continues to struggle.
Tags:
Share it:
