European gas prices rebounded modestly, with TTF stock rising 2.3%, after a speculative sell-off pushed the market towards longer-term marginal cost levels. The pressure comes despite EU storage being well below the five-year seasonal average, ING commodities experts Ewa Manthey and Warren Patterson noted.
Speculative selling pressures TTF despite below-average EU stockpiling
“European gas prices appear to have found a floor, rising yesterday; the Transfer Facility (TTF) settled 2.3% higher. The European gas market has come under significant pressure, amid strong selling by speculators. This is despite EU gas storage recently falling below 72%, compared to a 5-year average of 82% for this time of year.”
“Weakness in the TTF should slow LNG flows into Europe, with JKM’s premium over the TTF widening in recent weeks. At the same time, broader weakness in Europe has pushed gas prices towards the long-term marginal cost of US LNG producers. If these price levels persist, they are likely to raise further questions about the viability of export projects ahead of a final investment decision.”


