By KYIV. May 10 (Interfax-Ukraine) – Spot prices for gas in Europe with the start of the new week have begun recovering after their 6M low of $400/1,000 cubic meters logged last week.
European has entered a short period of mild spring weather with lower consumption, when the heating season has concluded but summer heat necessitating use of air conditioning has not yet set in.
The Gas Transmission System Operator of Ukraine, or GTSOU, has accepted a booking from Gazprom on Wednesday to transport 40.5 million cubic meters of gas through the country, after 32.8 mcm on Tuesday, data from the GTSOU show.
Capacity was requested only through one of two entry points into Ukraine’s Gas Transmission System, the Sudzha metering station. A request was not accepted through the Sokhranivka metering station.
Wind power generation in Europe remains at a modest level. Beginning in May, wind turbines have provided an average of 14% of the region’s electricity needs, according to WindEurope.
After falling to $400/1,000 cubic meters late last week, spot prices for gas have recovered somewhat this week. The day-ahead contract for today at the Dutch TTF gas hub in the Netherlands closed at $407/1,000 cubic meters.
A split between LNG prices in Asia and those in Europe can be seen. In Asia, the most expensive futures contract for June on the JKM Platts index is $401/1,000 cubic meters, and futures under the LNG North-West Europe Marker are $376/1,000 cubic meters.
Europe continues the gas-injection season into underground gas storage (UGS) facilities. Current inventory levels in Europe’s UGS facilities are 62.04%, which is 20 percentage points above the average for the same date over the past five years, according to Gas Infrastructure Europe.
Inventories increased 0.28 percentage points during the gas day for May 8, with the pace markedly lagging the usual injection levels over the past five years. Nevertheless, reserves could reach the target level of 90% storage capacity by the end of September if injection continues at this pace throughout the summer.
European LNG terminals operated at an average capacity of 67% in April, while capacity in May has been 65%.
The state of gas in UGS facilities in the United States is of increasing importance for the global market, and the country is actively increasing gas exports.
Freeport LNG, the United States’ largest LNG plant, has reopened all three liquefaction lines, thereby reducing the excess gas on the U.S. market and boosting supplies of LNG to the global market.
The U.S. continues the injection season into UGS facilities. Inventories rose 1.5 billion cubic meters for the latest reporting week, which is 33% lower than the usual figure for this time of the year.
The current level of inventories is around 43%, which is 20 percentage points higher than the average figure for the past five years, according to the U.S. Energy Department’s Energy Information Administration.
