EUROPE GAS prices range bound on warmer weather and Ukraine peace talks
The Dutch and British wholesale prices of gas traded in a narrow band on Tuesday. This was due to a strong supply coming from Norway, liquefied gas (LNG), softer demand because of warmer temperatures and ongoing discussions to end the conflict in Ukraine.
LSEG data shows that the benchmark Dutch front-month contract was 29.45 euros per Megawatt Hour (MWh) or $9.50/mmBtu at 0920 GMT. This is a decrease of 0.32 Euro. The contract dropped below 30 euros on Monday for the first since May 2024.
The British gas day-ahead price is 0.25 pence less at 77.75 cents per therm.
The LNG export is expected to increase by 90 GWh/d, with cargoes destined for the Netherlands and Belgium. Norwegian production is stable with no planned outages this week. Total gas demand remains largely unchanged.
The temperature in Northwest Europe is forecast to stay at 3 degrees Celsius for the next day, but will rise to 5 degrees Celsius over the weekend, and to 6 degrees Celsius on the workdays of the following week.
LSEG data revealed that local distribution zone consumption (which refers to the domestic demand for heat) is reduced by 169 gigawatt-hours per day, to 4324 GWh/d, on the day before, and by 98 GWh/d, to 3711 GWh/d, over the weekend.
U.S. officials and Ukrainian officials tried to narrow the gap between them Monday on a plan to stop the war in Ukraine after agreeing to change a U.S. proposition that Kyiv, and its European allies, saw as a Kremlin want list.
Dauhalevich of LSEG said that while the news may have influenced the market's sentiment, it is still uncertain what the final outcome will be given the previous failures in negotiations with Russia.
Analysts at Engie EnergyScan wrote in an early morning note that European net storage withdrawals fell yesterday but are expected to rise slightly today.
EU gas storage inventories have fallen to 78.68% of their previous level, down from 87.90% in the past year.
The benchmark carbon contract in Europe was down 0.50 euros at 79.91 euro per metric ton. (Reporting and editing by Marwa Rashed)
(source: Reuters)
