European gas prices were up yesterday, supported by Gazprom’s decision to suspend gas deliveries to Dutch operator GasTerra as of 31 May after the company refused to comply with the new ruble payment mechanism.
GasTerra, which buys and trades gas on behalf of the Dutch government, said it had contracted elsewhere for the 2 Bcm of gas it had expected to receive from Gazprom between now and 1 October 2022, the date on which the contract ends.
Higher gas demand from power generators due to lower wind generation and the rise in coal prices (+0.21% for API2 1st nearby prices, +2.78% for Cal 2023 prices) also provided support.
On the pipeline supply side, Norwegian flows rebounded yesterday, averaging 327 mm cm/day, compared to 306 mm cm/day on Friday. Russian flows were stable, at 209 mm cm/day on average.
At the close, NBP ICE June 2022 prices increased by 12.550 p/th (+8.18%), to 165.910 p/th, equivalent to €66.460/MWh. TTF ICE June 2022 prices were up by €1.11 (+1.28%), closing at €87.987/MWh. On the far curve, TTF ICE Cal 2023 prices increased by 55 euro cents (+0.70%), closing at €79.150/MWh.
In Asia, JKM spot prices increased by 5.14%, to €78.821/MWh.
For their last day of trading, TTF ICE June 2022 prices closed above the 5-day average yesterday, confirming the (slight) uptrend. This morning, July 2022 prices continue this bullish trend.
But, with the main fundamental supports (Asia JKM prices, coal switching prices) at much lower levels, the upside potential could be limited. In this context, the R1 level (€92.94/MWh for today) should oppose a strong resistance.
On TTF Cal 2023 too, the R1 level (€80.78/MWh for today) should oppose a strong resistance.