EUROPE GAS-Dutch prices rise due to lower Russian supply and competition for LNG

European wholesale gas prices rose on Friday morning amid falling Russian flows at the start of the new gas year and record Asian prices, intensifying competition for LNG supplies to fill storage as the end of the year approaches. Winter.

The November gas price at Dutch hub TTF, a European benchmark, was up 5.97 euros to 96.47 euros per megawatt hour (MWh) at 09:51 GMT.

On the ICE exchange, the contract briefly rose to 100 euros per megawatt hour on Friday morning.

The UK equivalent was down 8.15 pence to 245.85 pence per therm after jumping 35 pence on Thursday.

Russian gas supplies through the Yamal-Europe pipeline fell nearly 77% on Friday from Thursday, although the drop is expected as Gazprom suppliers have not reserved additional capacity for the new gas year, which begins. October 1, after the expiration of the old contracts.

“Low Gazprom pipe via Poland to Germany; pure and simple increasing heating demand and the combination of these two injections of means [into storage] will slow down at a time when they are still needed, ”one analyst said.

An increase in supply from Norway could only avoid higher prices rather than causing prices to fall, he added.

“The main lever that needs to be squeezed to bring prices down is a significant year-over-year increase in Russian gas delivered to Europe, which looks possible next year,” Energy Aspects analysts said. in a report.

Gazprom has completed laying the Nord Stream 2 gas pipeline to Germany and is awaiting certification from the German regulator, which is expected to last until early 2022.

Meanwhile, Europe continues to face fierce competition for liquefied natural gas (LNG) shipments from Asia.

Chinese buyers are seeking more LNG shipments despite record prices, offering prices above market rates as the winter season begins with a low gas supply in the country.

LNG spot prices hit a record high of $ 34.47 per million British thermal units (mmBtu) on Thursday, up more than 500% from the same period last year.

The EU benchmark carbon contract of December 21 increased from 0.95 euros to 62.69 euros per tonne.
Source: Reuters (reporting by Nora Buli; editing by Shailesh Kuber)

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