The Asian LNG spot price continued rising yesterday after a barn-storming bull run over the Christmas and New Year break, propelled by ongoing frenzied winter buying amid reports that a spot cargo changed hands for more than USD 20/MMBtu – reportedly the highest on record for the Platts JKM benchmark. CME’s JKM futures contract, a financial hedging instrument against JKM, yesterday rose 4.4% to USD 14.93/MMBtu having already gained 36% between Christmas Eve and New Year’s Eve.
European gas hubs are following suit on forecasts of imminent colder winter temperatures, with month-ahead UK NBP gaining 5.4% yesterday to settle at the equivalent of USD 8.06/MMBtu and Dutch TTF rising by 3.8% to USD 7.13/MMBtu. NBP has not traded above USD 8/MMBtu since January 2019.
Oil prices softened yesterday amid ongoing splits in the OPEC+ alliance over production cuts, with Brent edging closer to the critical USD 50/barrel threshold and WTI dropping below USD 48/barrel. However, both were trading up by more than 1% on Tuesday morning.
The European carbon price surged to a fresh all-time high yesterday of EUR 33.56/tonne, surpassing the previous record of EUR 33.29/tonne achieved on 28 December. The start of the new ten-year trading phase yesterday was characterised by renewed speculative buying, spurred by the EU’s recent decision to target at least 55% emissions reductions on 1990 levels by 2030.
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 reserved.