Prices for gas in Europe are mixed due to economic concerns and storage requirements
The Dutch and British wholesale gas price were mixed on Tuesday, as economic concerns and forecasts for milder weather continued to exert pressure. However, Europe's need to replenish storage also provided support.
LSEG data shows that the benchmark Dutch front-month contract fell by 0.70 euro to 34.70 euros per Megawatt Hour (MWh) at 0905 GMT.
The British day-ahead contracts rose 0.20 pence, to 86.55 p/therm. Meanwhile, the within-day contract fell 1.00 pence down to 86.00 p/therm.
In a morning report, LSEG analyst Saku Jussila said: "We expect some negative sentiment today due to the warmer weather predictions and recession fears in the international financial industry."
The analyst said that the weather forecasts for Britain and northwest Europe have been significantly raised since the end of last week.
Meanwhile, President Trump's criticisms of U.S. Federal Reserve Chief Jerome Powell have stoked new economic concerns.
Analysts at Engie EnergyScan said that regardless of the economic conditions in the world, it is unlikely that the European gas markets will be oversupplied any time soon.
They added, "We think that prices have more upside than downside potential."
Gas Infrastructure Europe (GIE), a European gas infrastructure company, has revealed that Europe's storage sites were almost two thirds empty at the end of winter and last recorded as being 37.04% filled.
Jefferies analysts reported that EU gas storage grew by 1.6 billion cubic meters (bcm) in the week ending on April 20. This is higher than the average five-year increase for this time of the year.
They added that to reach the EU's target of 80% and 90% by November 1 will require additional injections of 48 and 59 Bcm, respectively.
Naftogaz, the Ukrainian state-owned oil and gas company, has said that it wants to purchase more than 2 billion cubic meters (bcms) of gas in order to replenish storage sites to record low levels before the heating season of 2025/26.
The benchmark carbon contract in Europe was down 1.53 euros, at 64.36 euro per metric ton. Nora Buli, reporting from Oslo. Editing by David Goodman
(source: Reuters)
