Dutch and British wholesale gas prices eased slightly on Monday morning amid small revisions towards milder, windier weather early this week, but colder weather next week and low storage levels continue to support.
The benchmark front-month contract at the Dutch TTF hub (TRNLTTFMc1) was down 0.29 euro at 53.31 euros per megawatt hour (MWh), or $16.00/mmBtu, by 0921 GMT, according to LSEG data.
In early trading, the contract briefly hit a fresh 15-month high 54.47 euros/MWh.
In Britain, the front-month contract (TRGBNBPMc1) fell by 2.10 pence to 128.9 p/therm, while the day-ahead contract was down by 1.00 pence to 132 p/therm.
Temperatures are set to rise the next days and wind output will also be quite strong on Tuesday but storage levels and temperatures will be the main drivers for the rest of the month to the end of winter, a trader said.
“The forecasts are not clear yet about the duration of that cold spell. As long as the end cannot be anticipated, the downside is limited and bullish sentiment could persist, albeit at a lower pace,” LSEG analyst Ulrich Weber said.
EU gas storage levels were 53.11% full on Saturday, data from Gas Infrastructure Europe showed.
“We are not at any ‘crisis levels’, but the market would probably like to see somewhat higher storage given historic levels may not be as relevant anymore,” SEB analyst Ole Hvalbye said.
Full storage tanks in Europe “only” cover around 20% of annual European demand, while there is no new storage capacity planned and supplies are more dependent on “unpredictable” liquefied natural gas (LNG), he added.
As Russian pipeline gas supplies have dwindled, several floating import terminals were installed quickly in Europe during the 2022 energy crisis.
However, one of these, in Eemshaven in the Netherlands, is currently evaluating whether to continue operations beyond 2027.
Analysts and traders said it was too early to say how the trade war sparked by U.S. President Donald Trump over the weekend might impact the European gas market.
In the European carbon market (CFI2Zc1), the benchmark contract was down 1.08 euro at 82.85 euros a metric ton.
Source: Reuters