(Bloomberg) -- European natural gas investors have become the most bullish this year as volatility rattles the regional market for the fuel.  

Investment-fund positions in benchmark Dutch futures last week turned net-long for the first time since October, data released Wednesday by Intercontinental Exchange Inc. show. Longs — essentially bets that prices will rise — edged higher, while shorts fell by more than 20%. 

Net-longs also reached the highest level since March 2022, during the first weeks of Russia’s war in Ukraine.  

The move marks a sharp shift in sentiment in Europe’s gas markets, after a surge in short positions earlier this summer. At the time, most industry watchers expected gas prices to fall due to healthy supplies and muted demand. 

However, in June a wave of extensions to gas works in Norway, Europe’s top fuel provider, caused price spikes. Speculators were forced to close their bets on further declines in gas, resulting in even sharper price moves and extreme volatility, similar to what the market faced at the height of Europe’s energy crisis last year.

Market turbulence returned last week on news of potential worker strikes in Australia — boosting prices by as much as 40% intraday. Funds faced another round of so-called covering of short positions.  

The market remains on edge as labor negotiations in Australia are likely to continue next week. Works in Norway are also underway and are set to deepen later this month and in early September. 

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