The purpose is to analyze the emergent commercial forces that promote incre
asing competition in the European natural gas market. The paper begins by d
escribing the traditional market organization, along with its monopolistic
elements and inflexibilities. It goes on to illuminate the destabilizing fr
ustration among producers with fast growing supply potential, caused by the
limited growth in demand under prevailing market arrangements. Two emergen
t commercial forces promoting competition are then dealt with. The first is
the increasingly widespread effort by large consumers to procure gas on im
proved terms by circumventing the national transmission companies. The impo
rtant role played by Wingas in this respect is reviewed in detail. The seco
nd is the impending impact of the Interconnector, a gas pipe between the UK
and the continent, which becomes operational during 1998. The paper argues
that these commercial developments are undermining existing monopolies and
will bring about increasing competition, even if the formal regulatory reg
ime stays intact. (C) 1999 Elsevier Science Ltd. All rights reserved.