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Free AccessGlobal Natgas Prices Hold Geopolitical Risk Premium amid Strong Supply
Global gas prices are holding their geopolitical risk premiums acquired since Hamas’ attack on Israel Oct. 7, despite robust global supply, Platts said.
- Between Oct. 6-Oct. 18, JKM spot prices rose 48%, although between this had moderated to 21% by Nov. 2. European TTF prices were up 37% Oct. 6-Nov. 2 although had peaked at 71.4%.
- "The global natural gas market might have priced in too high a risk premium on geopolitics and supply, when prices of other commodities that have similar risk exposure have not had such a premium," analysts at Citi Research said Nov. 1.
- JP Morgan said the geopolitical risk premium could be stickier due to weather risks and uncertainty around peak winter weather demand, with one standard deviation weather event cutting European inventories by 9%.
- Citi Research also said that gas price volatility was affected by low demand sensitivity and absent supply sensitivity, Platts reported.
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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.