Gas Prices Fall As Supply Disruptions Ease

European LNG prices fell 1.5% on Friday to EUR 33.95 on an improved supply situation after trending lower from its EUR 34.70 high early in the session as the supply situation improved. They are now down slightly in June.

• The EU agreed on further sanctions on Russia, according to Reuters. Russian ships carrying LNG will also not be able to use European imports unless they’re unloading LNG for European consumption, which will impact supplies going to Asia. Investment in and supply of materials/services to Russian LNG projects will also not be allowed. Pipeline flows through Ukraine continue as normal.
• While Norway’s gas facilities continue to undergo planned seasonal maintenance, flows are at their highest since 2021 for this time of year.
• The repairs at Australia’s Wheatstone are completed and full LNG and domestic gas activity resumed on the weekend, which should reduce risks to Asian supplies.
• US natural gas fell 2.2% to $2.68 to now be up 3.3% this month. Prices peaked on June 11 at $3.16 and have trended lower since. The EIA reported a 71bcf inventory build in the week to June 14.
• North Asian prices were also lower down 1.4% on Friday to be up 3.3% in June. Hot weather has boosted demand through increased air conditioning usage. But the resolution of recent supply disruptions has put downward pressure on prices.