OPEC+ ramps up output
OPEC+ members swiftly decided to ramp up the group’s target production by 400 kb/d, with Saudi Arabia and Russia now required to produce 10.2 mb/d…
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European gas prices hit new record highs on Wednesday with the TTF August 21 contract trading just below the €40/MWh mark while NBP August 21 prices breached the 100 p/th mark for the first time since 2008. On the far curve, TTF year-ahead prices hit a new eight-year high at €27/MWh. In Asia, JKM prices also breached the $15/MMBTU mark, tracking gains at the TTF on the back of steady summer demand.
Low storage inventories and tight LNG supply to Europe (see below graph) due to fierce competition with Asian buyers should continue to fuel the bullish sentiment amid limited Russian gas transit through Ukraine. TTF front-month prices traded above the €40/MWh mark at the opening today. But with no specific news behind this new rally, risks of a downward correction are growing as most contracts at the TTF are approaching technical resistance levels and gas-to-power demand significantly dropped in July (-15% yoy in Western Europe so far).