Europe Gas: Prices rise on LNG, pipeline supply concerns

Fluxys Belgium SA

15/06/2022 10:15

June 15 (Reuters) - British and Dutch wholesale gas rose on
Wednesday morning as an extended outage at the Freeport
liquefied natural gas (LNG) plant and the curtailment of
supplies via the Russian Nord Stream 1 pipeline re-ignited
supply concerns.
    The Dutch front-month contract  TRNLTTFMc1  was up 4.10
euros at 101 euros per megawatt hour (MWh) by 0855 GMT, its
highest level since mid-May. The contract for winter 2022
 TTRNLTTFSc1  rose 2.33 euros to 105.30 euros/MWh.    
    "This was chiefly due to Gazprom's announcement that gas
shipments via the Nord Stream 1 pipeline will be slashed by 40%
to just 100 million cubic metres per day because a turbine for a
compressor station, which had been sent to Canada to undergo
maintenance, has not yet been returned because of the
sanctions," analysts at Commerzbank said in a note.  urn:newsml:reuters.com:*:nL8N2Y132H
    "This threatens to undermine the very solid replenishment of
stocks that has been seen of late. At a good 52%, storage
facilities in the EU were almost back at their usual filling
level recently.
    Physical flows to Germany through the Nord Stream 1 pipeline
dipped below 40,000,000 kilowatt hours per hour (kWh/h) on
Tuesday, but were seen higher at 44,888,472 kWh/h on Wednesday
morning.  urn:newsml:reuters.com:*:nL8N2Y21M0
    Gas storage sites in the European Union were 52.63% full,
data from Gas Infrastructure Europe showed, but Europe faces a
perilous winter even with full storage, analysts warned.
 urn:newsml:reuters.com:*:nL8N2XV3M8
    Supply concerns are further compounded by an outage
extension at Freeport LNG, one of the largest U.S. operators of
liquefied natural gas export terminals, which would remove 40
cargoes.  urn:newsml:reuters.com:*:nL4N2Y12WD
    "Especially the LNG news is clearly bullish for the balance
of summer as well as winter," a trader said.         
    In the British market, the gas contract for within-day
delivery  TRGBNBPWKD  rose by 10.00 pence to 180.00 pence per
therm and the day-ahead contract  TRGBNBPD1  jumped by 14 pence
to 180 p/therm, setting a two-month high for both contracts.
    The UK gas system was slightly under-supplied despite a rise
in Norwegian gas flow, while gas-for-power demand was higher
amid lower wind speeds, Refinitiv analysts said.
    In the European carbon market, the benchmark contract
 CFI2Zc1  rose by 1.12 euros to 85.27 euros a tonne.

 (Reporting by Nora Buli in Oslo; editing by Nina Chestney)
 ((Nora.Buli@thomsonreuters.com; (+47) 21 04 05 56; Reuters
Messaging: nora.buli.thomsonreuters.com@reuters.net))