European natural gas prices edged higher as the season’s first cold snap takes hold, potentially raising demand ahead of the official start of the heating season.

Benchmark futures headed toward €38 a megawatt-hour on Tuesday after climbing for three consecutive sessions. Prices are elevated for the time of year and have been prone to volatility amid a number of recent supply disruptions and geopolitical risks.

For now, stronger wind generation is helping to keep the market balanced and accounted for about half of the UK’s power supply on Tuesday. Traders are also finding some comfort in the region’s brimming underground storage facilities, which are almost 93% full.

Still, the first cold spell of the season risks bolstering fuel consumption in northwest Europe at a time when major global producers are facing potential disruptions to their operations.

The US Gulf coast, where many of Europe's fuel suppliers are based, is bracing for a strengthening storm. And an export facility in Australia deepened capacity cuts due to safety inspections.

Dutch front-month futures, Europe’s gas benchmark, rose 0.9% to €37.67 a megawatt-hour at 9.22am in Amsterdam (3.22 pm Malaysia). The UK equivalent contracts were up 1.0%.

  - Bloomberg