European gas prices took a breather after their strong rise of the previous session. The drop in coal prices (-3.34% for API2 1st nearby prices, -3.95% for Cal 2023 prices) also exerted downward pressure. For the moment, this decline in coal prices is essentially technical. But a more significant decline is possible if the global coal market ultimately turns out to be less tight than feared (see the Gas & Coal Weekly Report published on Friday).
On the pipeline supply side, Russian flows remained stable on Friday at 104 mm cm/day on average. On their side, Norwegian flows rebounded, averaging 311 mm cm/day, compared to 298 mm cm/day on Wednesday.
At the close, NBP ICE July 2022 prices dropped by 17.100 p/th (-9.15%), to 169.740 p/th, equivalent to €67.339/MWh. TTF ICE July 2022 prices were down by €4.842 (-3.63%), closing at €128.505/MWh. On the far curve, TTF ICE Cal 2023 prices dropped by €2.317 (-2.34%), closing at €96.865/MWh.
In Asia, JKM spot prices dropped by 0.96%, to €119.261/MWh; August 2022 prices dropped by 0.09%, to €119.930/MWh.
TTF 1st nearby prices did not manage to drop below the 5-day average on Friday (which would have paved the way for a drop towards the 20-day High, which stands at €126.08/MWh for today, and would have accelerated the “normalization” process). Prices are rebounding this morning. The trading range for today could be between the 5-day average and the R1 level. The “normalization” process requires prices to trade in the lower part of this range, but upside risks cannot be ignored.
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