American and European natural gas recorded significant price hikes as lower temperatures and a protracted cold snap across most of the continent and on the other side of the Atlantic, raised demand against a backdrop of reduced capacity.
The American NG closed 7% up late yesterday (Friday) at 5,38 dollars per million MMBtu, with the TTF, the European reference NG rising by 3%, at 39,3 euro per megawatt.
According to OilPrice.com, winter temperatures have remained below the seasonal average, leading to the fastest draining of European natural gas stocks in the past five years, as consumer heating demand steadily rises.
Capacity at EU terminals dropped to just 47% on January 21st according to OilPrice.com, which cited the latest Gas Infrastructure Europe numbers.
Such storage levels are well below the recent averages, a clear indication that Europe will need to import additional quantities of natural gas in the summer to replenish its stocks.
In addition, rising demand means that LNG imports are now more individually expensive for every consumer across Europe and Asia.
Dutch TTF futures for January have risen by 30%, going from 34 dollars per megawatt on January 2nd to 45 dollars on January 23rd, a trend set to continue.
SOURCE-CNA