Natural gas prices were close to 50 euros per megawatt hour on Thursday, driven since the beginning of June by the drop in supply from Norway, due to leaks and maintenance at many facilities. The Dutch TTF futures contract, considered the European benchmark, rose more than 10% to 42.30 euros per megawatt hour (MWh), shortly after touching 49.95 euros per MWh, its highest level since the beginning of April.
After the war in Ukraine, Norway has become the main supplier of natural gas on the European continent. At the end of May, “a gas leak at Equinor’s Hammerfest LNG plant forced it to shut down,” boosting prices, DNB analysts note.
Result: according to Lu Ming Pang, from Rystad Energy, the fluxes via Northern gas gases from continental Europe and the Royal-United States recovered 244 million meter cubes per day on June 5, with 300 million m3 per day observed. last year.
Heavy facility maintenance.
By early June, the TTF price had fallen to €22.885 per MWh, its lowest price since May 2021, as high storage levels in Europe combined with lower demand due to mild spring temperatures weighing on prices. But since then, the price of TTF has skyrocketed by more than 85%. This sharp rise remains subdued compared to the surges the highly volatile TTF has already seen.
The rise in gas prices in Europe “came as LNG (liquefied natural gas) imports began to slow under the combined effect of strong maintenance of LNG bunkering facilities and stronger Asian demand,” analysts say. of Energy Aspects in its weekly report distributed by UniCrédito.
The post-Covid recovery is running out of steam
Analysts expected the cuts in the supply of liquefied natural gas, but “the market took the physical evidence of this slowdown as an opportunity to exit some of the short positions that had been accumulating in the gas market,” they continue.
On the oil side, a barrel of Brent from the North Sea, for delivery in August, rose 2.28% to $74.87. Its US equivalent, a barrel of West Texas Intermediate (WTI) for July delivery, gained 2.40% to $69.91. Prices took advantage of the pause in rate hikes announced on Wednesday by the US central bank (Fed), the first since March 2022 after ten consecutive hikes.
Enough to allow the world’s largest economy to breathe for a while, which could support demand for crude. The European Central Bank (ECB) raised its key interest rates by 0.25 percentage point on Thursday. On Tuesday, the Chinese central bank had, to the surprise of analysts, lowered its short-term reference rate, a measure to support activity in the world’s second largest economy in a context of post-Covid loss of bellows.
Source: BFM TV
