Prices of EUROPE GAS rise due to unplanned Norwegian outage
The wholesale gas prices in the Netherlands and Britain were mostly higher on Wednesday morning, due to a unplanned outage of Norway's Nyhamna Gas Processing Plant.
LSEG data show that the benchmark Dutch front-month contract for the TTF hub rose by 0.45 euros to 34.92 euros per Megawatt Hour (MWh) at 0750 GMT. The September contract, however, was only 0.21 euros higher at 34.96 Euros/MWh.
The August contract in the British market was up 0.81 penny at 83.01 cents per therm.
LSEG data shows that Norwegian flows to the continent have decreased by 7 million cubic meters (mcm), after flows through Nyhamna's processing plant were restricted because of an unplanned failure.
"The impact today is 50 mcm/d, and we haven't yet seen a similar drop in flows." If the impact is realized, there is a possibility of more drops today. Also, July is a month with many holidays in Norway. This increases the chance of delays if it turns out to be worse than expected.
"We are expecting a bullish response today to the Nyhamna Outage. In the past, similar unplanned outages have been extended multiple times and affected markets significantly. The risk may not be realized if the flows do not drop any further and the issue is resolved tomorrow," Jussila stated.
The market players are closely monitoring Asian LNG demand. A heatwave in Japan, and North Korea is supporting the demand for spot cargoes. This could limit the cargoes that Europe can use to replenish its storage.
Analyst estimates show that gas storage inventories have reached a level of 63.24%, which is almost 22% less than in 2024.
The European Union did not approve a new set of sanctions against Russia Tuesday as Slovakia demanded additional guarantees that the country would not be adversely affected by a separate EU proposal to phase out Russian Gas.
Slovakia cannot block the EU's proposal to ban Russian Gas by 2028, with a phase-out beginning in 2019. The proposals need to be supported by a majority of countries.
The benchmark carbon contract on the European market fell by 0.44 euros to 71.07 euro per metric ton. (Reporting and editing by Nina Chestney; Marwa Rashad)
(source: Reuters)
