Pricewatch | 04 Feb 2022 | Gas Matters Today

European gas prices continued to climb on Thursday amid a further drop in Russian gas flows into Europe.

The March-dated TTF and NBP contracts posted gains of ~5% on Thursday, with the Dutch marker settling at the equivalent of USD 26.86/MMBtu – USD 0.64/MMBtu higher than the UK gas benchmark.

The rally was prompted by a drop in Russian gas flows into Europe, with nominations at the Velke Kapusany entry point on the Ukraine-Slovakia border falling by 10 MMcm/d on Thursday, according to EnergyScan. Forecasts for colder weather across much of Europe next week also helped lift prices.

The strengthening gas prices helped lift the European carbon price to a fresh high. The February-dated EUA contract closed 1.2% higher to settle at EUR 94.81/tonne.

Across the pond, US gas benchmark Henry Hub fell by 11.1% despite a cold blast hitting Texas, raising concerns of well freeze-offs. The March-dated Henry Hub contract settled at USD 4.89/MMBtu.

Asian LNG marker JKM continued to tick higher, closing 0.6% higher at USD 24.34/MMBtu.

As for oil, US crude benchmark topped USD 90/barrel for the first time since 2014. The rally was pinned on concerns that the frigid weather in the US could impact oil production. In the north-east of the country, oil demand for power production has increased in recent days due to cold weather.

The April-dated Brent contract closed 1.8% higher at USD 91.11/barrel. The March-dated WTI contract closed 2.3% higher at USD 90.27/barrel.

Front-month futures and indexes at last close with day-on-day changes (click to enlarge):

Time references based on London GMT. Brent, WTI, NBP, TTF and EU CO2 data from ICE. Henry Hub, JKM and API2 data from CME. Prices in USD/MMBtu based on exchange rates at last market close. All monetary values rounded to nearest whole cent/penny. Text and graphic copyright © Gas Strategies, all rights.