European gas futures surge on supply concerns

  • Energy Department plans to buy an additional 3 million barrels of crude for the SPR
  • Europe Natural Gas surges on supply concerns and US gas ends 5-day rally
  • 10 – Treasury yield rises 2.9bps to 3.747%


Natural gas prices are surging on expectations a heat wave could trigger a spike in demand.  Gas prices have been steadily weakening over the past year on weak demand, sluggish industrial activity, and as inventories were filled. Now we are seeing key outages, hot weather, and rising risks supplies could be tight this winter.  The European gas benchmark rose over 20% to €33.40. 

Oil was poised for a quiet day, but the surge with natural gas prices gave energy trades a big boost. Next week will be big for oil as we get a few major central bank rate decisions that should determine the short-term outlook for the global economy.  China may cut rates, the Fed could deliver a hawkish skip, and the ECB is still playing catch up with their tightening cycles.  Oil will eventually trade higher when stockpiles are at uncomfortably low levels.   


Gold prices are little changed ahead of next week’s central bank-a-palooza.  Gold volatility should be elevated as prices could break out of the $1950 to $2000 trading range.  It might hinge on the US inflation report, which should show pricing pressures are easing.  The Fed seems likely to pause their tightening cycle and if the updated forecasts remain optimistic inflation is going to get a lot closer to target, that could be good news for gold bulls.  Softening US data should support calls that a June skip could eventually turn into a July pause.  Next week, most of the data is expected to remain weak or little changed: retail sales could be flat m/m, the Fed regional surveys should remain in negative territory, and consumer sentiment will waver.

The gold bears are trying to take control as some of the drivers for bullion remain negative; global bond yields remain elevated, India demand is expected to decline 5% in 2023 and safe-haven demand struggles with stocks entering a bull market.  

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Ed Moya

Ed Moya

Contributing Author at OANDA
With more than 20 years’ trading experience, Ed Moya was a Senior Market Analyst with OANDA for the Americas from November 2018 to November 2023.

His particular expertise lies across a wide range of asset classes including FX, commodities, fixed income, stocks and cryptocurrencies.

Over the course of his career, Ed has worked with some of the leading forex brokerages, research teams and news departments on Wall Street including Global Forex Trading, FX Solutions and Trading Advantage. Prior to OANDA he worked with, where he provided market analysis on economic data and corporate news.

Based in New York, Ed is a regular guest on several major financial television networks including CNBC, Bloomberg TV, Yahoo! Finance Live, Fox Business, cheddar news, and CoinDesk TV. His views are trusted by the world’s most respected global newswires including Reuters, Bloomberg and the Associated Press, and he is regularly quoted in leading publications such as MSN, MarketWatch, Forbes, Seeking Alpha, The New York Times and The Wall Street Journal.

Ed holds a BA in Economics from Rutgers University.