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Don’t Mistake the Gas Meltdown for End to Europe’s Energy Crisis

  • LNG cargoes have provided relief to spot markets in Europe
  • But forward prices signal the crunch will last into 2023

Don’t let the recent meltdown in European natural gas prices fool you. The energy crunch of 2021 will last for years. 

That’s what futures traders are betting on, with spot prices dropping a lot more than forward contracts over the past week. The scale of the moves signal the flotilla of liquefied natural gas cargoes heading to Europe will only provide short-term relief, and prices will still be expensive all the way to March 2023.