European futures reversed the downward trend and returned to growth on Tuesday, boosted by fresh threats from Gazprom to cut supplies via the Ukraine route and the EU mulling a price cap on the Dutch TTF marker.
The front-month TTF contract settled 3.4% higher on Tuesday, at USD 36.02/MMBtu, while the UK benchmark NBP has increased to its one-week high of USD 32.58/MMBtu, up 2.8%.
EU Commissioner for energy Kadri Simson has yesterday proposed a cap on the Dutch natural gas benchmark, set at EUR 275/MWh and will be enacted when that price is breached for two consecutive weeks.
The rises were, however, softened by strong winds throughout much of Europe which boosted power generation. According to WindEurope, the share of wind energy in electricity demand on Tuesday reached 22.4% from 18.1% the day prior.
In addition, Gazprom has threatened to cut a portion of gas it supplies via Ukraine – one of the last functioning gas supply routes to Europe. The Russian gas giant has accused Ukraine of holding on to the gas meant for Moldova and has threatened from to cut supplies from 28 November if those imbalances remain.
Meanwhile, US benchmark Henry Hub remained unchanged from Monday at USD 6.78/MMBtu. The JKM market surged 7% to USD 29.22/MMBtu.
In oil, Brent saw a rise of 1% to USD 88.36/barrel, while WTI increased by 1.5% to USD 80.95/barrel. The rise was facilitated by the EU announcing it would add a 45-day transition period to the introduction of the price cap on Russian oil exports.
Front-month futures and indexes at last close with day-on-day changes (click to enlarge):
Time references based on London GMT. Brent, WTI, NBP, TTF and EU CO2 data from ICE. Henry Hub, JKM and API2 data from CME. Prices in USD/MMBtu based on exchange rates at last market close. All monetary values rounded to nearest whole cent/penny. Text and graphic copyright © Gas Strategies, all rights.
Our three titles – LNG Business Review, Gas Matters and Gas Matters Today – tackle the biggest questions on global developments and major industry trends through a mixture of news, profiles and analysis.
LNG Business Review
LNG Business Review seeks to discover new truths about today’s LNG industry. It strives to widen market players’ scope of reference by actively engaging with events, offering new perspectives while challenging existing ones, and never shying away from being a platform for debate.
Gas Matters digs deep into the stories of today, keeping the challenges of tomorrow in its sights. Weekly features and interviews, informed by unrivalled in-house expertise, offer a fresh perspective on events as well as thoughtful, intelligent analysis that dares to challenge the status quo.
Gas Matters Today
Gas Matters Today cuts through the bluster of online news and views to offer trustworthy, informed perspectives on major events shaping the gas and LNG industries. This daily news service provides unparalleled insight by drawing on the collective knowledge of in-house reporters, specialist contributors and extensive archive to go beyond the headlines, making it essential reading for gas industry professionals.