European gas prices were mixed on Friday, torn between comfortable spot fundamentals and fears on the evolution of Russian flows in the coming weeks (they were slightly up to 214 mm cm/day on average, compared to 211 mm cm/day on Thursday. The resilience of Asia JKM prices (spot prices dropped by 0.32%, to €110.091/MWh; May 2022 prices increased by 0.14%, to €109.556/MWh) also contributed to fuel some bullish sentiment and limit the downside potential.
At the close, NBP ICE April 2022 prices dropped by 3.780 p/th day-on-day (-1.51%), to 246.000 p/th. TTF ICE April 2022 prices were down by 4 euro cents (-0.04%), closing at €105.044/MWh. On the far curve, TTF ICE Cal 2023 prices were up by €1.38 (+2.20%), closing at €63.971/MWh.
TTF ICE April 2022 prices continued to trade in a very narrow range on Friday, with the 20-day Low as support level and the 5-day average as resistance level. This means we are approaching the time when the market must choose its direction. The level of Asia JKM prices and the level of the most expensive gasoil substitution possibilities (in the €119-136/MWh range) point to a price rebound. But the improving stock levels and the continued Russian exports can give the feeling that European gas balances are now comfortable enough to allow gas-fired power plants to operate more: a price drop towards the coal switching range (whose maximum is currently around €83/MWh) would then be feasible. Prices are trying to break below the 20-day Low this morning. If this is confirmed during the session, it would mean that the market begins to believe in the bearish scenario.
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