Will European Gas Prices Come Down in 2024?

By Cormac Breen

Content Manager

At the start of 2024, the average price for natural gas in Europe was €0.1125 per kWh, having almost doubled since the beginning of 2022. Prices are expected to fall in 2024 due in part to the diversification of gas sources along with the increased use of renewable energy across the continent, reducing demand. Natural gas prices in Ireland remain high at €0.1638 per kWh and well above the EU average.

European Gas Prices in 2024

At the start of 2024, the average price for natural gas in Europe was €0.1125 per kWh, having almost doubled since the beginning of 2022. This was largely due to Russia's invasion of Ukraine in early 2022 which sparked an energy crisis across Europe.

Across the 27 EU member states, natural gas is most expensive in Sweden at €0.2070 per kWh, while Hungary is the cheapest at €0.0335 per kWh.

Last Updated: August 2024
Source: Eurostat

Have European Gas Prices Started Coming Down?

Following a huge spike in the cost of natural gas, prices have begun to reduce due in part to the following:

• Increased supply of natural gas from Norway.
• Gas storage reserves remaining high.
• Importation of LPG (Liquid Petroleum Gas).
• Falling demand due to mild winters and warm summers.

A ban on the importation of Russian gas initially caused the huge price increase in 2022, but EU intervention and efforts to diversify gas importation has led to a decrease of almost 80% since the peak of the crisis in late 2022.

The increased importation of LPG has had a big impact on natural gas prices in Europe and while imports from the US have increased, geopolitical tensions in the Middle East have created logistical issues from the transportation of LPG from the region that may influence prices later in the year.

As Europe enters winter, increasing demand for gas for home heating may see an increase in the price prompting more people to look to switch provider and reduce costs.

What About Gas Prices in Ireland?

In 2024, natural gas in Ireland costs €0.1638 per kWh, making Ireland the second most expensive country in the EU for gas after only Sweden.

Ireland has seen a huge increase in the price of natural gas over the last 4 years, with the price rising from €0.06 per kWh in 2020 to almost triple that price in 2024. 

This big increase in the cost of energy has put huge pressure on homeowners dealing with the cost of living in Ireland.

Below, you'll find a graph outlining the price evolution of natural gas in Ireland over the last 5 years.

Last Updated: August 2024
Source: Eurostat

While energy sourced from renewables, in particular wind energy, provided 34% of Ireland's energy in 2024, gas imports still account for a large percentage of Irish energy production and as a result, high prices given the logistical cost of importing and transporting natural gas.

What Can I Do To Lower My Natural Gas Bills?

Given that gas prices remain high in Ireland and with no significant decrease likely to happen this year, there are some steps you can take to try and lower your gas bills.

• 🔥 How To Lower Your Gas Bills
• Compare gas providers and their prices to see if you can find a cheaper deal.
• Invest in a non-gas fuelled means of heating your home, such as a heat pump.
• Improve the insulation of your home to lower your consumption of gas.
• Invest in solar panels to heat your water instead of gas.
• Avail of SEAI grants to retrofit your windows and doors to lower your gas heating demands.

What Caused European Gas Prices To Rise?

Perhaps the most important causes have been the unprecedented events that have caused the gas markets to react unfavourably and pushed energy costs up and up. 

These events have been responsible for much of the economic issues that Europe has been experiencing since 2020, but they have had a unique impact on the gas markets:

COVID-19 Pandemic

When COVID-19 hit Europe in early 2020, supply chains across all sectors and industries experienced disruption. This disruption was due to national lockdowns, decreased travel between countries, and social distancing rules making it more difficult for suppliers to get goods and services to where they need to go.

The resulted in a big increase in the rate of inflation, driving costs, including energy, up and up.

Cold Winter 2020

In 2020, Europe experienced a particularly cold winter, that meant an increased demand for gas to heat the home. Naturally, this sapped much of the gas reserves, leading to a depletion for the following year.

Gas Reserve Shortage

Usually, Europe keeps reserves of gas stored up for such events so that customers can have gas supplied to their homes, and that prices remain relatively stable. 

However, in 2021, these reserves were subsequently not restocked during the summer and consequently left Europe with a shortage for the winter.

Russia and the War in Ukraine

The Russian invasion of the Ukraine had immediate repercussions on the commodities markets. 

As soon as Russia invaded on 24 February, the price of natural gas shot up, breaking the record set by the December peak and again causing additional strain to suppliers.

The impact of the international sanctions aimed at bringing about Russian financial collapse has been noticeable for commodities and natural gas over the last 2 and a half years.