EUROPE GAS-Prices rise after fresh Ukraine infrastructure attacks
After initially trading in a sideways direction, Dutch and British wholesale prices of gas rose on Thursday after Russia attacked the key storage infrastructure of gas in Ukraine. This comes at a time when there is growing concern about the rapid filling of European gas storages.
LSEG data shows that the benchmark Dutch front-month contract was up by 1.18 euros to 32.95 Euro per megawatt hour or $11.21 per mmBtu at 1507 GMT.
The British contract for the front month rose 3.34 pence to 82.35 cents per therm. Meanwhile, the price of the day-ahead contract was up 1.70 penny at 81.90 cents per therm. Analysts said that the news of a Russian air strike on a gas compression station in eastern Ukraine, which is crucial for getting gas to storage facilities during winter heating season was likely behind Thursday's gains.
Analysts at Engie's EnergyScan said that this could lead to an increase in Ukraine's demand for gas from its neighbours over the winter, and also compromise the filling of storage facilities both in Ukraine and Europe. Analysts at Engie EnergyScan wrote in a morning report that the lack of progress in the negotiations for a peace agreement in Ukraine will likely continue to support energy prices.
Gas Infrastructure Europe data shows that EU gas storage sites are currently 74.49% full.
Analyst Ole Hvalbye of SEB bank stated that while this level is not alarming, it's still 4.4 percentage point below the 10-year median (2015-2024) and 16 percentage points lower than last year at the same time.
Analysts at Northern Power & Gas say that the delays in LNG shipments across the Atlantic could also be due to hurricanes or storms.
The risk of ending the winter with depleted gas reserves is increased by LNG delays.
The benchmark contract on the European carbon markets was 72.49 euro per metric ton, up by 1.20 euros. Reporting by Marwa Rashed in London and Nora Buli from Oslo. Editing by Elaine Hardcastle, Philippa Fletcher and Elaine Hardcastle)
(source: Reuters)
