Prices for gas in Europe remain stable as global demand and outages support prices
Dutch and British wholesale prices for gas were mostly flat on Friday morning. Outages and worries about a tighter market globally supported the price, but this was partly offset by an increase in wind power production that will reduce demand for gas powered power next week.
LSEG data shows that the benchmark Dutch front-month contract for the TTF hub increased by 0.02 euro to 35.22 euros (MWh) or $11.78/mmBtu at 0900 GMT.
The British day-ahead contracts was up 0.50 penny at 83.50 cents per therm.
The slight increase in day-ahead gas prices is due to a continuing unplanned outage in Norway at the Karsto facility, where flows that were originally intended to reach the UK have been redirected to Germany," Northern Power & Gas analyst said in a briefing in the morning.
They added that an outage at Bacton Perenco's UK site also affected supply.
Karsto, a Norwegian plant, is having processing issues and will also be undergoing annual maintenance starting Saturday through to late August.
Analyst Yuriy Onyshikiv of LSEG said that higher wind speeds in the next few days should reduce gas-for-power consumption.
Analysts said that the market is also supported by hot weather conditions in Asia which are driving demand and by concerns about secondary tariffs imposed by the United States against countries who import Russian energy. These secondary tariffs could divert volumes from Europe.
ANZ commodities analyst Daniel Hynes stated in a daily report that several LNG tankers heading for Europe changed their course in the last few days, increasing competition for cargo.
The drop in LNG supplies could affect Europe's ability to fill gas storage for the winter.
Energy Aspects wrote in a report that Europe has made good progress with its stockpiling, but they still expect relatively low stocks at the end of October, which means there is little room for error if global imbalances tighten.
Gas Infrastructure Europe has released the latest data showing that Europe's gas storage facilities are 68.3% filled.
The benchmark contract on the European carbon markets was down 0.64 euros, at 72.02 euro per metric ton. (Reporting and editing by David Goodman.)
(source: Reuters)
