Prices maintained their short term downtrend

European gas prices dropped significantly yesterday, still pressured by above-normal temperatures and more comfortable supply. Norwegian flows rebounded to 337 mm cm/day on average yesterday, compared to 328 mm cm/day on Wednesday. Russian flows were also higher, to 265 mm cm/day on average, compared to 262 mm cm/day on Wednesday. The drop in Asia JKM prices (-7.45%, to €88.799/MWh, on the spot; -6.20%, to €93.521/MWh, for the December 2021 contract) and in parity prices with coal for power generation (both coal and EUA prices were down) also exerted downward pressure.

At the close, NBP ICE November 2021 prices dropped by 26.500 p/th day-on-day (-12.12%), to 192.090 p/th. TTF ICE November 2021 prices were down by €9.79 (-11.27%) at the close, to €77.032/MWh. On the far curve, TTF Cal 2022 prices were down by €4.34 (-7.92%), closing at €50.474/MWh, and the spread against the coal parity price (€32.452/MWh, -4.98%) narrowed.

For their last day of trading, TTF ICE November 2021 prices broke yesterday below the supports of the 5-day Low and the 20-day Low. December 2021 prices are tempting a rebound this morning. They could manage to rise above those support levels, but the rebound should be limited as the short term trend is bearish (with the 5-day average as resistance level), particularly as coal prices continue to weaken in China, the National Development and Reform Commission saying that there is still room for the country to further adjust coal prices.