Europe set for warmest January in years as gas crisis eases

Bloomberg

Europe is set for the warmest January in years, easing an energy crunch that has hammered the region for months.
Mild conditions are likely to persist across the region until the end of the month, with a strong weather front blocking out cold polar air, according to forecaster Maxar Technologies Inc. While sparking climate concerns, the warmth over the past couple of weeks has been a boon for nations as they struggle against a crushing cost of living crisis that has seen household energy bills and inflation surge.
Temperatures are forecast to range between 2C to 5C above normal in France and Germany through Jan. 17, sending heating demand in Europe below the 10-year average, according to Maxar and the Weather Company. The UK, which had its warmest year on record in 2022, is likely to see the mild conditions persist this month, according to the Met Office.
For Europe, “the first half of the month could rank among some of the warmest on record over the last few decades if things unfold as expected,” said Matthew Dross, a meteorologist at Maxar.
It’s a sharp turnaround from the freezing temperatures of early December that had raised concerns over natural gas reserves depleting too quickly. Governments and consumers spent much of the summer worried they would face blackouts after Russia’s sharp gas supply cuts following the war in Ukraine.
But stockpiles are now fuller than normal, with some nations even sending gas into storage in recent days as demand eases with the weather. Along with strong imports of liquefied natural gas, there’s increasing confidence that the continent can go through this winter unscathed. And high inventories at the end of the cold season will make it easier to replenish storage sites in time for next winter.
European gas futures on Wednesday closed at the lowest level since October 2021, while power prices have also declined sharply. They could ease further with Maxar’s Dross forecasting blustery conditions in the UK and continental Europe through to mid-January, which will increase wind power generation and in turn curb gas use.
Still, the energy crisis is far from over. Russia’s deep supply cuts continue to be a concern as replacing the huge volumes is difficult. Daily flows to the European Union are down around 80% compared with this time last year, and there is a real risk the remaining
shipments will be halted.