European gas prices were largely flat on Friday morning against a backdrop of an expected fresh package of European Commission sanctions against Russia and extended Norwegian gas outages.
The benchmark Dutch front-month contract at the TTF hub (TRNLTTFMc1) was down 0.25 euros at 32.58 euros per megawatt hour (MWh), or $/mmBtu, by 0806 GMT, LSEG data showed.
The Dutch day-ahead contract (TRNLTTFD1) was down 0.13 euros at 32.33 /MWh.
The British front-month gas price (TRGBNBPMc1) gained 0.25 pence to 81.80 pence per therm while the weekend contract (TRGBNBPWE) was up 0.25 pence at 80.50 p/therm.
The European Commission is discussing a proposal to bring forward a ban on Russian liquefied natural gas (LNG) in a new package of sanctions against Moscow over its invasion of Ukraine, to be presented on Friday, an EU official said late on Thursday. The ban had been set to start from the end of 2027.
European gas prices firmed on the news, with Russia still covering more than 10% of EU gas imports and about half of that delivered as LNG, said Daniel Hynes, senior commodity strategist at ANZ.
“However, much depends on the timing of the phase-out. With global LNG markets expected to push into a surplus later this decade, any sanctions in the short term will have an impact on prices,” he added.
Unplanned extensions to outages at Norway’s Troll gas field and the Kollsnes onshore processing plant also supported prices, said Arne Lohmann Rasmussen, chief analyst at Global Risk Management.
However, Norwegian flows continue to recover after sharp declines from planned outages ahead of winter, said LSEG analyst Oleh Skrynyk, adding that LNG supply and storage levels remain healthy.
Among bullish factors for gas demand were colder weather and a drop in wind power output. Demand from households and small industry in northwest Europe is expected to increase by 336 gigawatt hours (GWh) per day on Monday, Skrynyk added.
EU gas storage sites have reached 81% of capacity, compared with a little more than 93% a year earlier, Gas Infrastructure Europe data showed.
In the European carbon market, the benchmark contract (CFI2Zc1) was down 0.57 euros at 77.27 euros a metric ton.
Source: Reuters
