Investing.com -- European gas storage withdrawals have slowed in the past week, though levels remain significantly below historical averages, while US gas demand continues to exhibit strength, according to a recent analysis from UBS.

UBS reports that "European gas storage levels amounted to 40%, or 41bcm, as of 25 February, falling by 3% w/w."

While this represents a decrease, the bank said "the pace of storage withdrawal dropped to -2.8bcm from -4.8bcm a week ago."

However, it is still "faster than -1.6bcm recorded a year ago."

The firm attributes the slower withdrawal to increased LNG imports, which have helped stabilize supply.

UBS estimates that EU gas demand stayed flat m/m in February to date, “but increased by >25% compared to a year ago." They now forecast a lower exit storage level of 35% at the end of March 2025.

In contrast, US gas stocks are said to have experienced a large withdrawal, with the EIA reporting a decrease of 261Bcf.

This draw, while "slightly bearish vs. consensus of -266Bcf," is still "faster than a -60Bcf draw in 2024."

UBS attributes this to increased feedgas flows into LNG export plants and increased heating demand during a cold snap."

"European gas prices retreated amid milder weather and potential relaxation of storage targets," while "US Henry Hub prices also went down below $4/mmBtu...on milder weather forecast."

UBS notes that concerns persist in Europe regarding higher injection during the summer and the potential return of Russian gas remains uncertain. Despite the concerns, the firm highlights that the EU is looking at investment into LNG projects abroad, and joint gas purchases, to help secure long-term deals.