Gas Prices Lower On Steady Supply & High Storage Levels

European LNG prices rose to a high of EUR 35.11 early in yesterday’s session but then trended lower to EUR 33.45 to be down 3% on the day. Storage levels remain seasonally high and mild weather is expected to continue in the north while the south is likely to be hot. Norwegian flows, a key supplier, have been consistent.

• Euro area’s June manufacturing PMI at 45.8 continued to point to a significant contraction in activity in the sector. Soft industrial demand has weighed on gas prices for some time.
• US natural gas prices fell 4.6% to $2.48 despite concerns that this year’s hurricane season will be severe. Output has picked up while storage levels are high and cooling demand expectations have eased, both weighing on prices. Forecasts are for lower temperatures in central US but the west remains hot, according to Maxar.
• A federal court has stopped the US administration’s halt on approvals for new LNG export facilities.
• North Asian prices are down 1.4%. China’s June LNG imports fell 6.2% y/y as higher prices since February have reduced demand, according to shipping data from Kpler.