(Bloomberg) -- European natural gas prices are trading near levels seen before the energy squeeze started brewing in May 2021, with industry players cautioning that may trigger stronger demand in Asia.

The benchmark contract in the Netherlands closed below €23 a megawatt-hour, posting a third weekly loss with more than a month to go for the winter heating season.

While the declines in European prices highlight a comfortable supply situation — storage sites are still about 65% full — costs are also falling in Asia. Price-sensitive buyers there are turning to liquefied natural gas, in part pulling supply from the global market Europe depends on.

“Currently Europe depends strongly on LNG, and what we are also observing is that with European gas prices going down, Asia starts to attract more LNG,” said Marco Saalfrank, head of Continental Europe Merchant Trading at Swiss utility and trader Axpo Solutions AG, in an interview this week.

Prices are now near levels seen in May 2021, when Russia gradually began withholding some of its pipeline gas flows to the continent. 

Buyers in China, India and Thailand have increased purchases of LNG. While flows to Europe are still relatively high, that may change if the pull from Asia intensifies with slumping global prices. Fresh LNG supplies won’t be available until the middle of this decade and beyond. 

“Not enough LNG has been procured in the long run. LNG is a global thing, if there’s another spike anywhere, if Asia picks up in terms of demand, we’re always behind the train,” said Jörg Selbach-Röntgen, chief executive officer of MET Germany GmbH.

LNG from the US, a top exporter, is more profitable to Asia in April, May and June, according to BloombergNEF. 

Dutch front-month futures, Europe’s gas benchmark, closed 1.1% lower at €22.93 a megawatt-hour at 6 p.m. in Amsterdam. 

“Moving forward, it is not a given we will get all the LNG we want,” said Gregor Pett, chief analyst at German utility Uniper SE. “Europe has had two mild winters now, which has helped. We can’t count on that in the future.”

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