European natural gas prices strengthened yesterday, with TTF settling just over 2% higher on the day, ING's commodity experts Ewa Manthey and Warren Patterson note.

European gas prices to remain well supported

"The increase reflects diminishing hopes for a Russia-Ukraine peace deal. Meanwhile, storage levels in the EU stand just under 38% full, compared to 62% last year and a 5-year average of 49%."

"Given the larger task of refilling storage this year, we expect European gas prices to remain well supported. The risk to this view would be a relaxation in storage targets or a peace deal that leads to the resumption of some Russian pipeline gas flows to Europe."