Gas Summary at European Close: TTF Boosted by Political Uncertainty

European natural gas prices reversed losses earlier in the day to briefly trade above €51/MWh before dropping back below. Escalating conflict in Israel following an explosion at a Gaza hospital and subsequent the cancelling of President Biden’s visit to Jordan continue to provide upside. Meanwhile. a halt to industrial action in Australian LNG facilities is providing downside.

• TTF NOV 23 up 4% at 50.85€/MWh
• TTF Q1 24 up 4.1% at 56.8€/MWh
• Australian labour unions called off strikes at Chevron’s two LNG facilities, after workers accepted the firm’s proposed settlement on Tuesday according to the Offshore Alliance.
• Norwegian pipeline supplies to Europe are just slightly lower today at 319.3mcm/d with capacity reductions still in place this week at Oseberg, Troll and “process problems” at Aasta Hansteen.
• European natural gas storage edged up again although with a drop in injections from yesterday as gas in store approaches capacity. Stores are at the highest in over ten years at 97.98% full on 16 Oct according to GIE data.
• Stronger LNG demand from China could add to the upside risk to European gas prices with increased competition for LNG supplies over the coming winter. Economic data from China last night showed better than expected GDP although Asia’s LNG imports in the January-September period this year have remained below levels seen in 2021 according to Bloomberg.
• Russian pipeline gas supplies to China could very soon reach the level that we previously exported to Western Europe," according to Gazprom CEO Alexei Miller.
• European LNG net import flows rose up to 358mcm/d on 16 Oct according to Bloomberg after seeing levels around 290mcm/d over the previous few days.
• LNG stockpiles held by Japanese power generators increased by 15.5% last week to 2.16mn tons as of 15 October, according to data released by the trade ministry.
• Shell has signed a supply deal for the Netherlands with QatarEnergy to buy 3.5mtpa of LNG from 2026 for the duration of 27 years, according to the Qatari company, cited by Bloomberg.
• Asia’s LNG imports in the January-September period this year remained below levels seen in 2021, lacking the anticipated post-opening gas recovery in China according to Bloomberg.
• Kazakh state energy company QazaqGaz has agreed a new gas supply deal with China’s PetroChina, according to Reuters, citing the office of Kazakh President Tokayev.
• MNI COMMODITY WEEKLY: China Wields Power Over Putin Charm Offensive this Week. – Full piece here: https://enews.marketnews.com/ct/x/pjJscQDcw-QI6ag0IRhyTw~k1zZ8KXr-kA8x6nHDsKsptIPjO1OcQ