EUROPE GAS - European prices fall in line with crude oil as Middle East hopes for de-escalation are raised
Dutch and British wholesale gasoline prices fell from their 3-year highs in the morning of?Tuesday, mirroring oil market movements after?U.S. Donald Trump claimed that the Middle East conflict would end "soon".
Data from Intercontinental Exchange (ICE), showed that the benchmark Dutch front-month contract at the TTF hub had fallen by?7.98 euros to 48.47 euros per megawatt hour(MWh) as of 0852 GMT.
The intraday peak was 69.50 euro/MWh, which is the highest since January 2023.
The British contract was lower by 19.90 pence, at 123.63 cents per therm.
Trump claimed 'on Monday' that the United States has inflicted severe damage to Iran's navy and air force - and predicted the conflict will end much sooner than the four weeks he originally set out. He also warned about further strikes.
Arne Lohmann-Rasmussen is the chief economist of Global Risk Management. He said that comments made by both politicians sent oil and gas prices lower on Monday night. Oil?prices fell after gas markets closed. This put pressure on gas prices Tuesday morning.
The gas market is still constrained, despite Qatar, the second largest LNG exporter in the world, having shut down production. It has also been unable to ship LNG stored in the region out of the area via the closed Strait of Hormuz.
Ben Samuel, an energy markets analyst with brokerage Marex, says that the peak in LNG supply to Europe usually occurs in March or April, when weather conditions in Asia are milder.
He added, "But this will be a year of fierce competition for those volumes. It is likely that the contest will continue until some stability returns to Gulf Region."
More than 80% of Qatari LNG shipments are shipped to Asian customers, who now compete with European buyers, especially the United States, for cargoes coming from other suppliers.
Samuel stated that the European gas storage capacity is currently below 30% and it will take an additional 11 billion cubic meters (bcm), this summer, to reach the fullness level seen at the end September of last year.
The benchmark contract on the European carbon markets was up 1.51 euros, at 72.41 euro per metric ton. Nora Buli, reporting from Oslo; Nina Chestney, editing)
(source: Reuters)
