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MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
NATURAL GAS
The German government face a potential loss on unhedged gas bought into storage ahead of this winter due to the warm weather and sharp decline in market prices.
- Since the end of September 2022 average temperatures in Germany have been 1.58 degrees Celsius above normal. TTF prices have fallen about 55% since a period of cold weather in early December.
- German gas market area manager THE, on behalf of the government, bought and injected about 50TWh into storage last summer without offsetting winter gas sales according to Argus.
- Argus estimate THE would have a theoretical loss of more than €4.4bn, considering the estimated cost of purchasing the gas and the price decline seen so far during the winter.
- THE market area manager suggested all injected gas may not be withdrawn and "Precautionary measures with a view to the 2023-24 winter appear sensible and necessary to a certain extent."
- Storage levels could end the winter above 50% based on 2011-2019 withdrawal rates according to UniCredit.
- Concern for the ability to replenish EU stock levels during the upcoming summer is supporting the Sum23 contract above the front month and is not yet encouraging strong withdrawals.
- European gas storage levels are at 82.33% compared to a five year average of 64.81% according to the latest GIE data for 11 Jan.
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
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