A bit of calm after a hectic week
Volatility has been quite strong on financial markets last week, with the Fed minutes in the middle of the week and huge price variations on…
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European gas curve prices showed significant gains on maturities beyond WIN22 on Friday, still supported by political statements from the US over a blocking of the Nord Stream 2 pipeline in case of a Russian invasion of Ukraine and rising Brent and coal ARA prices. Overall, TTF ICE SUM 23 prices gained 9 euros week-on-week, reaching a new all-time high at €46.06/MWh at the close. Gains on prompt and near-curve contracts were more limited on Friday, notably as mild and windy weather weighed on short-term demand expectations.
An upward revision in temperature forecasts for the end of the week could weigh on prompt and near-curve contracts today amid strong wind speeds. On the supply side, Norwegian gas production is back at capacity level as the unplanned outage affecting Troll ended over the weekend. The startup of the Chinese Lunar Festival could also lead to reduced trading activity in NE Asia and keep a lid on spot LNG prices. Nevertheless, cold temperatures in NE Asia could remain supportive and continue to push for a recovery in JKM-TTF spreads. Developments around Russia-Ukraine should remain a key driver as well, with a key Biden/Scholz meeting planned on 7 Feb.