European natural gas prices are rising, traders are monitoring the surge in global demand.

European natural gas prices continued to rise this week, with traders weighing factors such as ample supply and the potential for tightening market conditions due to increasing demand in different regions globally. Benchmark futures prices rose by 3.2% at one point, after a period of relative calm where the 10-day historical volatility had dropped to its lowest level since September 2021. Following market turbulence in June, stronger than usual liquefied natural gas imports and weak demand for the fuel in China have been suppressing prices. Currently, Europe is striving to attract enough global natural gas to continue stocking up for the next heating season - an effort closely monitored by traders. However, high temperatures in North Asia have stimulated some spot purchases in the region, while cooler weather in parts of South America has boosted heating and LNG demand. It is forecasted that Germany, the largest economy in Europe, will see an increase in natural gas and coal-fired power generation demand this month due to insufficient wind power.