Europe's risk of winter energy nightmare recedes for now

Some good news for Europeans, heading into winter: Natural gas prices are plunging, as warm weather and growing stockpiles have massively alleviated pressure.

Why it matters: It suggests the nightmare scenario of winter without heat for millions of Europeans — resulting from the cutoff of Russian energy to the West — has been averted, for now.

State of play: Benchmark natural gas futures prices in Europe, priced on the Dutch Title Transfer Facility (commonly referred to as TTF) closed below €100 per megawatt hour Wednesday.

• Prices are down nearly 50% in just the last month and more than 70% from their August peak.

The abrupt drop is a result of a few things ...

• European stockpiling of natural gas has pushed storage levels to over 90% of capacity.
• Warm weather on the continent has cut heating needs.
• European officials continue to move toward price caps on the TTF contract.

What they're saying: "Europe has enough gas stored to survive this winter unless it gets very, very cold," wrote analysts with research firm Rystad Energy in a note Wednesday.

• "But the continent is not out of the woods yet — with Russian flows continuing to decline, winter 2023 will be even tougher."