European natural gas storage levels have become a key market indicator, according to Trafigura Group, a top trader of the fuel.

“The amount of gas in storage at the end of the winter will determine how much LNG Europe will buy in the summer, which then sets the global price,” Richard Holtum, global head of gas and power at Trafigura, said on the sidelines of the Gastech conference in Singapore.

Europe’s storage sites are almost full amid muted demand, which has weighed on demand and prices for near-term shipments of liquefied natural gas. But those inventories can be quickly eroded if there is a cold snap in the coming winter, and the region would be forced to compete with Asian buyers for a limited amount of available LNG.

Besides storage levels, traders are also carefully monitoring supply outages, including potential strikes in Australia that could shut some of the nation’s LNG plants. International gas markets, already roiled by a sharp drop in Russian pipeline flows to Europe following Moscow’s invasion of Ukraine, have been whipsawed by updates on discussions between the operators of export facilities in Australia and unions.

“Both the European gas system and the global LNG market have lost flexibility,” said Holtum. “And when you lose flexibility, you are very susceptible to price spikes.”