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[European Natural Gas: Geopolitical Factors and Cooling Temperatures Drive Price Volatility] ⑴ On Tuesday, core European natural gas spot prices rebounded, reversing the significant decline of the previous day. Geopolitical tensions and expectations of cooling temperatures were the main supporting factors. ⑵ Institutional data showed that the Dutch TTF near-month contract rose by about 2 euros, reaching around 96 euros per megawatt-hour, while the UK near-month contract also rose. ⑶ The previous trading day, the main contract fell by more than 10%, reaching a five-day low, indicating a significant shift in market sentiment in a short period. ⑷ Temperatures in Northwest Europe will continue to drop, with Friday's temperature forecast revised down by 2 degrees Celsius from earlier estimates, leading to increased demand for heating gas. ⑸ The temperature drop boosted local residential heating gas consumption by approximately 113 gigawatt-hours per day, marginally strengthening the supply and demand situation. ⑹ The European gas storage facility fill rate reached 74.56%, a record low for this time of year, indicating a weak inventory base. (7) Morgan Stanley points out that if winter temperatures are normal or colder than average, Europe will need to secure more flexible LNG supplies to replenish its inventory. (8) Strong Asian LNG demand has diverted shipments that could have gone to Europe, making it more difficult for European companies to secure supplies through bidding. (9) The benchmark scenario maintains a price forecast of €90 per MWh, assuming a generally warm winter and Qatari LNG exports returning to normal by the middle of the first quarter of next year. (10) Beyond the benchmark assumption, there is a greater risk of price increases; the optimistic scenario has been revised upward to €150 per MWh, due to the expectation of colder temperatures in the early fourth quarter consuming inventory buffers. (11) The benchmark contract in the European carbon market rose slightly, with prices approaching €89 per ton. (12) Trading is also influenced by the US midterm elections, with market participants maintaining a cautious attitude.