European & US Storage Remains Seasonally High

European LNG prices were lower yesterday but they are still up 5.5% in May to date driven by increased demand globally ahead of storage refilling for next winter. They fell 3.5% to EUR 30.71 Tuesday, close to the intraday low of EUR 30.55 on warmer weather which should boost inventories. It rose to EUR 32.13 early in the session. Increased competition with Asia for flows continues to keep markets alert.

• Temperatures are forecast to rise to 20C in Germany, UK and France in the next few days, according to Maxar Technologies. Gas prices rose in the UK due to a drop in power production from wind and an outage at the Barrow North terminal which has been extended to May 24.
• US natural gas prices rose 1.1% to $2.22 to be 11.6% higher this month driven by short covering. Storage levels remain very high at almost 35% above the 5-year average. Flows to the Freeport LNG export terminal are up close to 4% on Monday as activity normalises following outages.
• North Asian gas rose 0.7% to be up 5.3% as hot weather in the region is increasing power usage. Some shipments to the region from Australia’s Gorgon facility have been scheduled due to repairs on a production train.