EUROPE GAS-European Gas Prices Rise Back to 2023 High as US-Iran Conflict Enters Second Week
LONDON, 9 March - Benchmark European Wholesale Gas rose again on Monday to its highest level for more than three years, tracking a surge of?oil as the US-Iran Conflict entered its second weeks and shipping?around?the Strait of?Hormuz remained near a standstill. Iran named?Mojtaba?Khamenei as the successor to his father, who was killed in a car accident. This shows that the hardliners are still in control and appears to be closing off any way to an end to the Middle East war. Oil prices surged to $119 per barrel on the prospect that disruptions to energy supplies could continue longer than expected.
The Dutch front-month contracts at the TTF hub – the benchmark for Europe – hit their highest level since early January 2023. Jumping nearly 25%, they reached 66.50 euro per megawatt hour. By 1001 GMT, it was?trading 61.60 euro/MWh, a rise of 15.7%, according to ICE data.
On March 3, it had risen to its highest level since January 2023.
The British April contract was 15.4% higher, at 158.60 pence a therm.
The Middle East is expected to continue to be the main driver of price movements. "The war will continue to last longer" said LSEG Analyst Ulrich Weber.
Analysts from Societe General Commodities Research say the increase in price?also reflects tighter budgets, mainly due to two factors:
They said: "An increase of LNG demand, mostly from Egypt and Jordan. We assume that Israel's pipeline gas will be marginal for two weeks while upstream fields are offline. Second, a decrease in LNG supply, roughly 2.4 million tonnes, from Qatar and the UAE."
LSEG data revealed that the forecasts for the last two weeks in north-west Europe were colder than those of last Friday. This has increased the heating demand expectation.
The benchmark contract on the European carbon markets was up by 0.50 euros at 70.05 euro per metric ton.
(source: Reuters)
