Increased gas flows from Norway helps reduce prices
Gas prices resumed their downward trajectory at the NBP on Thursday amid higher Norwegian flows, and despite concerningly low European storage levels.
The biggest losses were posted along the near-curve, with the Winter 25 contract declining by over 4p/therm (0.14p/kWh) when compared to its previous close.
According to data from Norwegian operator Gassco, pipeline flow nominations into Britain’s Easington and St Fergus terminals have averaged a 14.4% increase this week compared to week 11, thanks in part to the conclusion of unplanned maintenance at the Åsgard field.
Much like the consistently high frequency of LNG deliveries across Europe we have seen of late, Norwegian imports meet a substantial proportion of both UK and EU gas demand.
Potential downside may have been limited by expectations of elevated injection demand over the coming weeks and months. According to Gas Infrastructure Europe, EU storage levels stood at just 35.89% full as of 12th March, well below the 60.07% recorded on the same date last year, indicating a significant shortfall to replenish ahead of next winter.
Comments by Vladimir Putin at a Russia-Belarus security conference may have intensified bearish sentiment during late afternoon trade.
The Russian President told state-owned media on Thursday that increased energy cooperation between Russia and the US could “ensure a gas pipeline for Europe”, benefiting Europe with cheap Russian gas.
It remains uncertain if a ceasefire agreement between Russia and Ukraine can be reached in the short term, with Putin expressing a willingness to negotiate following recent successful talks in Saudi Arabia.
However, he added that there were “issues that we need to discuss,” suggesting a counterproposal may soon be presented to the US administration.
This morning, the bears have been unable to sustain yesterday’s decline, with the Summer 25 front-season contract currently being offered at a premium of circa 3p/therm (0.10p/kWh) when compared to its previous settlement, though many contracts have yet to trade at time of writing
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Price commentary courtesy of Crown Gas and Power 