Energy and carbon prices were down across the board on Wednesday, with the steepest falls being in European natural gas futures, which fell again to their lowest levels since July.
In continental Europe, the October TTF contract fell by another 3.4%, from USD 12.04/MMBtu on Tuesday to USD 11.63/MMBtu. The third consecutive fall followed a 3.8% drop in the previous session. The price remained volatile on Thursday morning, oscillating around Wednesday close.
In local currency – stripping out foreign exchange impacts – month-ahead TTF is now 10.0% below where it was last Friday and 11.4% below its 2024 peak of EUR 40.40/MWh, reached on 9 August in the immediate aftermath of Ukraine’s incursion into southern Russia.
On some technical measures the contract is seen as oversold, but market fundamentals are currently bearish: storage facilities are close to full, demand is tepid as summer turns to autumn, Russian pipeline gas supplies continue to transit Ukraine, and LNG supplies are ample, despite high spot prices in Asia.
In the UK, NBP was down 3.6%, from USD 11.72/MMBtu to USD 11:30/MMBtu, its trajectory closely matching that of TTF.
In Asia, the JKM LNG benchmark also fell, but much less sharply, with the consequence that the TTF-JKM spread jumped to USD 2.16/MMBtu, making Asia a significantly more attractive region for LNG than Europe, even allowing for shipping costs in most cases.
The October contract was down just 0.3%, from USD 13.83/MMBtu to USD 13.79/MMBtu.
US gas prices remained volatile, with Henry Hub down 2.6% to USD 2.15/MMBtu amid weak demand because of autumn shoulder season weather.
Crude oil prices remained in freefall, with Brent down another 1.4% to USD 72.70/barrel and WTI down 1.6% to USD 69.20/barrel, but prices appeared to be stabilising early on Thursday.
This week’s petroleum status report from the US Energy Information Administration will be published today, a day later than usual because of the Labor Day public holiday on Monday.
European coal prices were dragged down by the fall in gas prices, with API2 down 2.2% to USD 4.57/MMBtu, the lowest month-ahead close since July.
European carbon prices suffered a similar fate, with EU carbon dioxide emissions allowances down 1.7% to EUR 66.41/tonne, also the lowest close since July.
And, finally, so-called “dynamic pricing” is in the spotlight in the UK, following a furore over the sale of tickets for the much-hyped reunion tour of the band Oasis (see the 27 August edition of Pricewatch).
The Competition and Markets Authority has launched an investigation into why fans who had queued for hours were faced with much higher prices than they expected when they finally reached the front of online queues. The outcome could have widespread ramifications in other markets.
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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.
Got a question or comment about this story or other energy matters? Drop our editor, Penny Sukhraj, a line: [email protected]
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