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Germany misses gas savings target last week, wholesale prices ease

FILE PHOTO: Germany inaugurates LNG terminal "Deutsche Ostsee" in Lubmin

BERLIN (Reuters) - Germany missed its gas savings target last week due to cold weather, data showed on Thursday, while global gas prices eased but were still four times higher than before the pandemic.

Gas consumption by households, businesses and industry in Europe's biggest economy was 9% lower in the third calendar week than the average for that week in 2018-2021, the head of the country's Bundesnetzagentur network regulator said, warning that more must be done to secure supply for next winter.

Consumption was down 34% in the second calendar week from the equivalent average, regulator chief Klaus Mueller said on Twitter, adding the current target was a 20% reduction.

Globally, wholesale gas prices on the futures market have fallen in the last few weeks to around 70 euros ($76.31) per megawatt hour (MWh) from an average of 117 euros per MWh last year.

But prices were still four times higher than before COVID-19 and the Ukraine war, as the average price was around 18.50 euros per MWh between 2015 and 2019, utility industry association BDEW said on Thursday.

"The current fall in wholesale gas prices is a good sign, but no reason to sound the all-clear," BDEW president Kerstin Andreae said, adding she expected wholesale gas prices to remain volatile.

Wholesale gas prices on the futures market have risen since 2021 with the economic recovery following the pandemic. Prices jumped further last summer with the sudden drop of Russian gas exports to Europe following Moscow's invasion of Ukraine.

Last year's skyrocketing prices pushed Berlin to set out a 200-billion-euro relief package to shield households and industry through electricity and gas price brakes.

But the German finance ministry last week said government spending on the caps could be lower than expected due to falling prices, while the economy ministry said it was too early to estimate how much of the aid would be used up.

BDEW's Andreae said lower gas prices would only affect customer later, as cheaper long-term contracts energy suppliers are signing now would take time to reach end consumers.

($1 = 0.9173 euros)

(Reporting by Riham Alkousaa and Rachel More; Editing by Madeline Chambers and Mark Potter)