An unseasonably warm winter and ample LNG imports are dampening expectations for high volatility when European countries start restocking natural gas reserves this spring, but risk still abounds for a region facing a tight supply outlook for years to come.

Headed into winter, the market faced the possibility of harsh weather and China’s return to the liquefied natural gas spot market, but neither have materialized. The region built higher than average storage levels before the heating season began in October, but prices have only recently come down to levels last seen since before Russia invaded Ukraine as supply concerns ease.  

As Europe experiences what could be one of the warmest winters on record, Kpler Inc.’s Eleni Papadopoulou, lead gas and LNG analyst, told NGI that...