A year of consolidation and a ‘new normal‘ comes to an end / Market stable after end of dramatic fluctuations from energy crisis / Political framework to continue to force players into further optimising diversification, storage, emissions strategies
For the European gas market, 2025 was a year of consolidation, structural adjustment, and consistency in an overall volatile geopolitical environment. Following the massive shocks of 2022/23, the market has transitioned to a new normal in many respects in 2025: extreme volatility has levelled off, market participants have established new supply chains and storage strategies, and political guidelines are actively steering towards greater security of supply- and emission-related requirements.
Price development: Moderate, but sensitive to news
The gas spot market in Europe – measured by the Dutch TTF as a reference – moved at relatively low and stable price levels in 2025 compared with the peaks of the energy crisis. At the same time, the market remained sensitive to geopolitical news, which was reflected in short-term price fluctuations (e.g. in June 2025 due to geopolitical tensions in global energy trading).
Noteworthy here is the continuous decline in spot market prices over the course of the year, which were slightly above the 2024 level on an annual basis, but this was due to the extremely high prices in Q1 2025, which weighed on the market throughout the year. Spot prices on the gas market are generally between Germany or the Netherlands (TTF) and other European benchmarks, as they refer to identical physical gas flows or exchange prices. Differences between countries mainly result from transport costs, local taxes/duties, fees for local transport, and regulatory mechanisms. These factors represent fundamental systemic differences, but not different market references.
Futures prices reflected this relatively stable price base: forward contracts remained close to spot prices, indicating a market environment without significant risk premiums. Earlier expectations that risk premiums could rise due to political or infrastructure bottlenecks did not materialise in 2025. As a result, futures for 2026 fell steadily throughout 2025. The picture looks similar for the following years, 2027/28.
Essentially, it can be said that the market confirms that price normalisation and supply dynamics go hand in hand as long as there are no serious, long-lasting supply disruptions.
Supply: LNG and pipeline diversity contribute to security of supply
Europe’s gas supply in 2025 was largely driven by rising LNG imports. According to global market reports, the continent achieved record LNG imports in the first half of 2025, with around 796 LNG tanker deliveries to European terminals, corresponding to a volume of around 75 bn m³ and approximately 20%-25% above the previous year’s level. The import volumes came mainly from the US (>50% market share), which is now the new dominant supplier, followed by Russia (LNG export share) with just under 15%, and Algeria and Qatar with just under 10% each. Other supplier countries such as Nigeria and Angola also contributed to flexibility and supply diversification. Pipeline imports from Norway also contribute to the stability of supply.
The combination of increased LNG import capacity and diversified pipeline supplies has enabled Europe to achieve a robust supply mix in 2025.
Storage: Lower levels, but strategically relevant
The development of gas storage levels remained a key early warning indicator and risk factor in 2025. While storage levels in Germany in December were around 64%, significantly lower than in the previous year, the EU average in December was around 70%, which was moderately higher but still below the peak levels of previous years (around 80% in 2024). In neighbouring countries such as the Netherlands, France, and Italy, storage levels were also below the historical levels of 2023-24.
The relatively low attractiveness of filling storage facilities despite increased imports is attributed, among other things, to narrow price differences between summer and winter contracts: limited seasonal arbitrage opportunities reduced the economic incentive for traders to store gas.
Although storage facilities did not trigger a supply bottleneck scenario, the lower fill levels show that supply buffers across Europe have been reduced, which could increase seasonal price risk.
Demand: Stable to slightly growing, but differentiated
Gas demand in 2025 has increased by around 6%-6.5% compared with the previous year, mainly due to increased use in the electricity sector after strong wind and hydroelectric output declined in some periods and gas-fired power plants had to secure the electricity supply. However, total consumption is below the historical peaks of the years prior to 2020. There were several drivers across the sectors.
“The basic mechanisms of the market, namely the relationship between supply and demand, dominate the gas market. A solid assessment of the situation and a reliable forecast of developments in market-influencing factors enables companies to make the right decisions and thus save money in the long term. As a result, this commodity product can consolidate competitiveness,” said PIE contributor and energy expert Dimitrios Koranis, managing director of Koranis Purchasing Solutions (www.koranis.de).
Industrial demand remained stable overall, with moderate growth, particularly in the chemical sector, the glass industry, and other energy-intensive processes. Households and heating applications, on the other hand, showed seasonal consumption patterns, with mild winter periods dampening heating demand. Gas continued to be used as a backup fuel in the electricity sector, particularly where fluctuations in renewable generation needed to be offset.
The demand trend confirms the thesis that gas continues to make an important combined contribution to supply – both as a raw material for industry and as an energy source for households and seasonal peaks (electricity).
Events & market interventions: Geopolitical elasticity and political decisions
The year 2025 was remarkable in terms of structural events. The European Union’s decision to phase out Russian gas (pipeline and LNG) by the end of 2027 at the latest marks a clear long-term change of direction. At the same time, however, the question arises as to what significance this will have if a peace treaty is ultimately concluded in Ukraine.
Regulatory adjustments in the area of methane emissions reporting influenced contract design and market transparency for gas imports, especially for LNG from overseas. This tends to dampen rather than promote the potential for price reductions.
Weather-related peaks in demand did not cause disruption but underscored the importance of seasonal hedging strategies.
Geopolitical supply disruptions in the Middle East and market risk components (e.g. Strait of Hormuz) had short-term, non-systemic effects. This year showed that the gas market is resilient to short-term geopolitical risks, but at the same time vulnerable to strategic supply changes in the medium to long term.
Country comparisons: Different structures, common trend
A look at selected countries illustrates that France uses gas primarily for households and industry, while nuclear energy dominates the electricity supply and storage levels are relatively high. Italy has strategically expanded its LNG dependency (expansion of terminals) and integrates LNG more strongly into its national supply strategy than Germany. The Netherlands acts as a transit country and storage hub of great importance for Central Europe. Austria has relatively small storage capacities and strong seasonal fluctuations in demand. Spain and the Mediterranean region are more dependent on LNG imports, which gives them short-term supply advantages, but also logistical risks.
All countries face the same strategic paradigm: diversification, resilience, and flexibility – even if they differ in their market structures and demand profiles.
Assessment and outlook
Overall, it can be said that the European gas market has stabilised after the dramatic fluctuations of the energy crisis subsided. LNG imports and pipeline diversity have significantly supported security of supply.
Prices throughout Europe remained moderate, sensitive to geopolitical news and still higher than Russian pipeline supplies. Storage levels are lower than in previous years, which may pose seasonal risks. Demand is stable to slightly increasing, driven by gas-to-power utilisation.
The gas market remains consolidated in its function as a bridge technology between traditional fossil fuel use and the energy transition. At the same time, the political framework is forcing players to further optimise diversification, storage and emissions strategies – a process that will continue to dominate in 2026 and beyond, dampening potential price reductions.
Autor: Dimitrios Koranis
This article appeared on the 19th of December 2025 at PI Web (Plastics-Information).
