Data from the London-based ICE exchange revealed on Thursday that gas futures in Europe have fallen to 3% below $450 per a thousand cubic meters first time since July 27, 2021.

Netherlands-based gas hub TTF opened trading at $447.3 for April futures, which marks a 3.2% decline.

There are generally five factors to consider in the fluctuation of demand and supply of natural gas, starting with seasonality, consumption patterns, the price of competing fuel-based energy sources, global events, and EIA reports. 

Europe's NetZero promises are one factor to consider in this context.

China has been buying immense amounts of LNG over the past two years, including from Russia and Qatar, in a bid to offset the economic effects of Covid-driven lockdowns.

Europe has bought excesses of LNG from China on a spot-on basis because purchases from the US do not include a destination clause.

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However, due to the EU's commitments to transit to a NetZero economy, Europe will have to continue buying on a spot-on basis.

Ultimately, these consequences hiked from the EU and the G7's price cap on Russian oil.

Chevron CEO Mike Wirth said during a conference at CERAWeek on Monday that the Russian price cap has generated a large number of obstacles in standard operations for global energy markets. 

"There's not a lot of swing capacity, there's not a lot of inventory capacity, so a little bit, and the system normally optimizes within those parameters, but there's now a lot of constraints: you can't sell to this country, you can't buy from that country, can't insure," Wirth said, adding that he does not see the prospect of Europe to become a dependent consumer of Russian gas ever again. 

President Vladimir Putin signed a decree on February 1, in retaliation to the price cap, to ban crude oil sales to countries abiding by the Western-led price cap on Russian oil.

Read more: Disregarding Russian oil supply 'would be a sin': QazaqGas