Mid-Day Gas Summary: TTF Plunges Despite Red Sea Diversions

Front month TTF plunged to the lowest since 2 August last year as heating demand in Europe is expected to fall with warmer weather next week. Additional downside is coming from high storage levels and a rebound in LNG flows into Europe. LNG tankers are avoiding the Red Sea route with Qatar’s tankers turning away according to Bloomberg ship tracking.

• TTF FEB 24 down -5.6% at 28.01€/MWh
• TTF SUM 24 down -5% at 28.37€/MWh
• ICE TTF positions of Investment Funds and Commercial Undertaking remain relatively unchanged in the last week with fund positions still showing a small net short.
• Global LNG traffic through the Bab al-Mandab strait has decreased significantly, with only one tanker sailing the waterway currently according to Bloomberg ship tracking and ICIS.
• Temperatures in NW Europe are expected to warm over the coming weekend with above normal temperatures expected from Jan 21 until the end of the month.
• Norwegian pipeline supplies to Europe are nominated slightly up from yesterday at 349.7mcm/d today. The Karsto processing facility will have reduced output of 12.6mcm/d during 23-25 January according to Gassco.
• European natural gas storage was down to 78.58% full on Jan 15 according to GIE data compared to the seasonal five year average of 67.1% with near normal net withdrawal rates this week.
• Total European LNG sendout was back up to 438mcm/d on Jan 15 after falling to around 390mcm/d over the weekend according to Bloomberg.
• LNG stockpiles held by Japanese utilities rose by 2.79% last week to 2.58mn tons as of 14 January according to data released by the trade ministry.
• Mexico Pacific will supply an additional 1.2mtpa of LNG to Exxon Mobil for the duration of 20 years, the firm said, cited by Reuters.