Prices of EUROPE GAS rise after Norway Outage

Dutch and British wholesale gas prices rose on Tuesday afternoon, as a planned outage in Norway offset initial losses, despite a reduced demand and well-supplied storage sites.

LSEG data shows that the benchmark front-month contract for the Dutch TTF hub increased by 0.51 euro to 40.50 Euros per Megawatt Hour (MWh) at 1259 GMT. It had traded earlier as low as 39.80 Euros/MWh.

The Dutch day-ahead contracts was up by 0.50 euros to 40.38 Euro/MWh.

The day-ahead contract in the British market gained 1.40 pence, to 100.50 p/therm. Meanwhile, the front month rose by 0.90 pence and now stands at 101.30 pence/therm.

Prices began to rise after Norwegian producer Equinor announced that it had shut down its Sleipner platform due to smoke detected in an electrical equipment room. However, the company said other sources were meeting their delivery obligations.

One trader commented: "The Equinor issue seems to be noise at the moment, but it just shows how quickly risk builds up."

The trader said that the short-term outlook for supply is good, as weather conditions are limiting demand, and European storage is 95% full.

Analysts said that the concern about liquefied gas (LNG), a result of conflict in the Middle East is causing a price increase.

A TotalEnergies executive has warned that the next LNG wave will not be available until 2027. This is later than the original forecast of 2025. Project delays are to blame.

This is nothing new. The note confirms the analysts' own opinion that 2025-2026 is the time period when the LNG market could be tight.

Egypt, which was a net gas exporter, is also expected to increase its LNG imports.

The benchmark contract on the European carbon markets was up by 0.28 euro at 62.04 Euros per ton.

(source: Reuters)