Europe’s coldest December for seven years is unlikely to derail what will probably be one of the warmest years on record.
In a last chilly blast, the first half of this month will be unusually cold before warming to near normal temperatures, according to eight meteorologists surveyed by Bloomberg. December may still be the coolest since 2010 as high pressure near Iceland and northwest Russia funnels arctic winds south, said Tyler Roys, an Accuweather Inc. meteorologist in State College, Pennsylvania.
While Europe is seen well-supplied for electricity this winter and natural gas stocks are higher than average for the time of year, those buffers could be tested in extended spells of extreme cold. China forecasts it will have gas shortages this winter, which may mean competition with Europe for liquefied natural gas cargoes already trading at the highest for the time of year since 2014.
“Extreme, even dangerous cold does threaten at times this winter including in December,” said Joe D’Aleo, WeatherBell Analytics LLC’s chief meteorologist. “Snow will develop in east Europe as it cools and will spread back toward the center with some possible in the U.K.”
The chilly start to December is already here. In Germany, temperatures are predicted to drop to near-freezing on Saturday versus a 10-year average of 3.4 degrees Celsius (38 Fahrenheit), according to Weather Co. data on Bloomberg. Czech Republic temperatures are set to fall below zero over the coming days.
The coldest conditions in the first half of December will be in Norway and across the southwest of Europe before warmer conditions return, according to MDA Information Systems Inc., a weather forecaster based in Gaithersburg, Maryland. This year is on track to be one of the warmest on record, said Rebecca Fuller, a senior meteorologist at MDA.
Milder temperatures may protect against energy price jumps, while higher-than-usual inventories of natural gas may help prevent the sort of fuel scarcity that occurred last winter. Spot LNG prices in northeast Asia rose 20 cents last week to $9.90 per million British thermal units, matching the highest level since January 2015, according to a report from World Gas Intelligence.
“I think storages have sufficient slack to accommodate a period of cold during December,” said Pierluigi Frison, a gas trader at Green Network U.K. Plc in London. “The big question is whether they will be able to do so later in the winter with lower stocks, if LNG prices in Asia remain this high.”
Also helping energy prices remain low will be high winds, which lowers the need for gas-fired power plants. Wind supply in the U.K. may surge past a record, set Monday, on Dec. 7, according to data from Elexon.
In early December “it looks like winds will gradually pick up,” particularly over the U.K. and Benelux and Germany, said Giacomo Masato, London-based meteorologist for Marex Spectron. “The tendency is toward high volatility with spells of very weak winds, but then subsequent spells of relatively strong winds.”
A change to milder weather in northern Europe seems probable by the middle of the month, but additional cold snaps, especially in the south, are still likely later in December, according to Matthew Dobson, a senior meteorologist at MeteoGroup U.K. Ltd.
Read more: http://www.bloomberg.com/