European natural gas futures fell 3.6% to around €32.1 per megawatt hour on Tuesday, extending a 15.1% decline in the previous session and moving further away from a seven-month high of €40 hit on January 23, as concerns about LNG supply eased. Near-term US weather forecasts turned milder, reducing heating demand and freeing up more gas for LNG exports. This improved the outlook for deliveries to Europe, which now relies on LNG for roughly half of its gas needs after losing most Russian pipeline supplies. The US supplied about 27% of the EU’s gas and LNG imports in 2025, making European prices highly sensitive to US supply conditions. Geopolitical risk premiums also faded after President Donald Trump said the US is in talks with Iran, easing fears of disruptions to LNG and oil shipments through the Strait of Hormuz. Still, EU gas storage is at just 41.1% full, far below last year’s level and the five-year average, keeping the market vulnerable to renewed cold or supply shocks.
