Natural gas prices stabilized in Europe after market fears of a possible escalation in the conflict between Iran and Israel calmed.

Natural gas prices rose sharply last week after Iran launched missiles and drones at Israel, in the first such attack launched from its territory.

However, analysts warn that risks remain in the medium term, and that recent events may be a prelude to broader challenges facing global energy cooperation.

Europe does not import large quantities of gas from the Middle East, but it has become increasingly dependent on global markets since it lost most of its supplies of Russian gas during 2022.

Even events far from the continent affect gas prices, and volatility has been a prevalent feature of the market since the energy shortage crisis.

Europe is currently focusing on rebuilding gas reserves for next winter, after ending last winter with record levels of reserves. Moderate weather and weak demand for industrial purposes have helped limit gas consumption.

Although gas prices have stabilized, Norwegian gas flows to Europe are still declining, due to unplanned maintenance work at some Norwegian gas facilities.