European gas prices increased strongly yesterday, supported by ongoing concerns on low stock levels ahead of the winter. The rise in Asia JKM prices (+7.53% on the spot, to €83.738/MWh, +6.36% for the November 2021 contract, to €85.187/MWh) and in parity prices with coal for power generation (both coal and EUA prices were up) provided additional support.
On the pipeline supply side, Russian flows were almost stable yesterday, averaging 315 mm cm/day, compared to 314 mm cm/day on Friday. Norwegian flows were significantly up, to 336 mm cm/day on average, compared to 319 mm cm/day on Friday.
At the close, NBP ICE October 2021 prices increased by 14.430 p/th day-on-day (+8.20%), to 190.380 p/th. TTF ICE October 2021 prices were up by €6.27 (+8.92%) at the close, to €76.507/MWh. On the far curve, TTF Cal 2022 prices were up by €3.95 (+8.88%), closing at €48.373/MWh, still significantly above the coal parity price (€39.865/MWh).
Russian flows to the Mallnow entry point are down this morning, triggering an additional rise in gas prices. In particular, TTF October 2021 prices are currently trading around €83.400/MWh (not far from Asia yesterday close prices) and TTF Cal 2022 prices around €51.250/MWh. At such levels, the additional upside potential seems limited for today.
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