Further rise…expectations of gas prices in Europe during 2025

Natural gas prices rose by about 45% in Europe this year, increasing the burden on consumers and companies trying to recover from the worst living expenses crisis in decades.
It is likely that further pumping will stop at the beginning of the year, with futures prices already increasing for next year, which represents a strong signal that prices may remain high for a longer period.

Natural gas in Europe

Some dealers point out that a halt could lead to prices rising by about 10 euros per megawatt-hour compared to prices if pumping continues as usual.
About half of Russian gas exports to Europe pass through the territory of Ukraine through a five-year transportation agreement, which will expire at the end of this month.
Last week, officials in Russia and Ukraine ruled out renewing the agreement, and at the same time, reserve gas reserves in Europe are declining at a faster pace than usual, due to a period of cold weather and weak winds.
It leads to an increase in energy consumption for heating purposes on the one hand and a decrease in the production of wind power plants on the continent on the other hand.

Increased energy consumption

The approximately 15 billion cubic meters of gas that Russia currently sends to Europe via Ukraine each year represents only less than 5% of the continent’s total needs.
However, despite the obvious indication, the loss of one of the last remaining ways to transport Russian gas via pipelines would put further pressure on an already short-supplied gas market.
It is also pushing global prices higher, according to analysts at Energy Aspects Ltd. in a note issued this month.

Prices are rising

For his part, Slovak Prime Minister Robert Fico urged the European Commission to address the imminent cessation of Russian gas transit through Ukraine.
He pointed out that the economic impact on the European Union will far exceed its impact on Russia, and Fico’s letter to European Commission President Ursula von der Leyen in this regard is his first attempt to ensure her personal intervention in this conflict.
The letter included sharp criticism of Ukrainian President Volodymyr Zelensky because of his pledge to stop Russian gas flows to prevent support for the Russian war against his country.