Prices have increased their rebound

European gas prices have increased their rebound yesterday, as the statements made by Russia’s Deputy Prime Minister Alexander Novak (saying that commercial gas deliveries via Nord Stream 2 may start right after the German regulator grants its permission) did not lift concerns about the level of Russian flows for the coming months. The rise in Asia JKM prices (+6.07%, to €110.883/MWh, on the spot; +6.24%, to €111.953/MWh, for the December 2021 contract) and in parity prices with coal for power generation (both coal and EUA prices were up) also provided support.

On the pipeline supply side, Russian flows were almost stable yesterday, averaging 260 mm cm/day, compared to 261 mm cm/day on Wednesday. Norwegian supply was slightly up, to 347 mm cm/day on average, compared to 344 mm cm/day on Wednesday.

At the close, NBP ICE November 2021 prices increased by 21.860 p/th day-on-day (+9.27%), to 257.610 p/th. TTF ICE November 2021 prices were up by €8.56 (+9.14%) at the close, to €102.172/MWh. On the far curve, TTF Cal 2022 prices were up by €4.79 (+9.06%), closing at €57.628/MWh, and widening the spread against the coal parity price (€40.590/MWh, +3.47%).

TTF ICE November 2021 prices broke yesterday the resistance of the 20-day High and the 5-day High, which means the market got out of its wait-and-see position and has decided to resume its uptrend, even before knowing what Gazprom will do for the monthly auctions of transportation capacity next Monday. Prices are up again this morning, receiving also support from the additional rise in coal prices in Asia. Like yesterday, profit taking by financial participants may just help limit the size of the rise.