Storage disincentives and regional dislocations roil European gas trading
The loss of Russian volumes has made for unusual market conditions
Record-breaking prices are not the only manifestation of disturbance at Europe’s gas trading hubs. The imposition of minimum storage levels requires injections but at the same time risks undermining the market economics of injecting. And attempting large-scale replacement of pipeline gas from the east with LNG from the west has highlighted previously unapparent bottlenecks in the European system that have caused locational price spreads to blow out, at times in entirely the opposite direction from their prevailing relationship. “The seasonal shape of the curve has been completely erased,” says Natasha Fielding, head of Emea gas pricing at price reporting agency Argus Media. By that, Fielding

Also in this section
6 December 2023
The threat of a big disruption to energy trade in the Middle East appears to be receding, but the fog of war is casting doubt on projects in the region
5 December 2023
Scepticism, confusion and disdain over OPEC+’s extended and deeper supply cuts should give way to an appreciation of the new multi-speed producer alliance
5 December 2023
Low debts levels and the advantages of larger companies among the reasons for the rise in activity