Prices for gas in Europe go up after US winter storm restricts LNG exports
The Dutch and British wholesale prices of gas rose slightly Tuesday morning, as the freezing weather in America continued to?curb liquefied gas exports.
A winter storm in the U.S. has left more than 548, 000 homes and businesses without power.
The storm is set to be the most expensive severe weather event since wildfires that ravaged the Los Angeles area in early 2025.
LSEG data shows that the benchmark European gas contract (the front-month Dutch contract) at the TTF Hub reached its highest level in April of last year on Sunday, but fell below it on Tuesday morning, at 39.85 Euros per megawatt hour or $13.87/mmBtu by 1010 a.m. GMT.
The British day-ahead contract for gas rose 2.83 pence, to 104.13 cents per therm. Meanwhile, the front-month contract increased by 0.15 pence (?0.15) pences per therm.
Europe's largest LNG supplier is the United States. Any disruptions in exports could impact on the European market.
U.S. Natural Gas Futures rose by 119% in five days, a record amount. They reached a three-year-high on Monday. This was after a polar blast last weekend boosted heating demands and reduced production by two years by freezing oil and natural gas pipes and wells.
U.S. LNG Feedgas fell?to an one-year low on Sunday of 12.1 Bcfd due to reductions in all plants including Freeport LNG, Texas, and Elba Island, Georgia.
Analysts at ING said that "in recent days, U.S. LNG plant have reduced their gas intake by a significant amount, estimated to be around 48 percent, which will result in reduced LNG exports."
TTF prices are still a premium over Asian LNG to ensure that LNG cargoes can be shipped to Europe where storage is now below 45%.
Shiptracking data revealed that at least two LNG tanks originally heading east were diverted to Europe and Turkey last week.
It's becoming more likely that the storage will finish 25/26 heating seasons below 25% full. This would be lower than the levels in 2022, ING stated.
Analysts at EBW Analytics?stated that the market would be looking to see how quickly U.S. manufacturing recovers, and if more extreme weather could occur next month.
In the future, there will be a large amount of LNG, mostly from Qatar and United States.
In the meantime, supply in North-West Europe is stable. LSEG data revealed that forecasts were revised to be colder up until February 6, and milder between February 8-18.
The wind generation in North-West Europe is expected to be above normal until February 4, before dropping below normal, and remaining at that level until February 10.
The benchmark contract on the European carbon markets was up 0.37 euros at 87.05 euro per metric ton. Nina Chestney reports.
(source: Reuters)
