Europeans Are in Store for Another Milder-Than-Usual Winter
(Bloomberg) -- Climate forecasts show Europeans are in store for another milder-than-usual winter, potentially helping to relieve demand for natural gas.
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The Copernicus Climate Change Service sees a probability of at least 60% that northern Europe and the Mediterranean will experience above-average temperatures between December and February. The rest of the continent has 40% to 50% odds of exceeding median historical temperatures measured over the past three decades.
Nowhere in Europe are temperatures expected to be below average for the season, according to a seasonal outlook updated on Monday.
Copernicus’s estimates are used by farmers, insurers and utilities to help adapt to a warming planet. Abnormally high temperatures could lower demand for gas during Europe’s peak heating season, as they already helped do during the previous two winters.
Traders are keeping close watch over weather patterns heading toward the end of the year, when a transit agreement governing Russian fuel flows through Ukraine expires. Countries including Austria, Hungary and Slovakia have continued to rely on Russian gas to cover the bulk of their demand.
While the end of the transit deal may affect their stockpiling efforts next year, milder temperatures should help keep a lid on gas prices for now. Other gas-heating markets, such as Japan and the US northeast, face a 70% to 100% probability of significantly higher temperatures from December to February, according to Copernicus. That would lower competition for liquefied natural gas shipments.
Data also suggest that parts of Norway, Sweden, Finland and the Baltics have a 40% to 50% chance of significantly more rain and snow than usual, helping to boost the region’s hydro power prospects.
“Precipitation is most likely below average in southwestern parts and above average over the northeast of the continent,” Copernicus reported.
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