Mid-Day Gas Summary: TTF Rises On Shipping Risks

TTF front month has rallied to an intra-day high of €35.815/MWh before easing back slightly with support from rising risks to shipping offsetting the warm weather in December, strong wind power output in Germany and healthy near term supplies.

• TTF JAN 24 up 3.5% at 34.36€/MWh
• TTF Q1 24 up 3% at 34.5€/MWh
• BP is the latest firm to pause all of its tanker traffic through the Red Sea following an increase in Houthi attacks on vessels in recent days, the firm said, cited by Bloomberg.
• On Monday, the UK’s Maritime Trade Organization said it had received a report of a possible explosion close to Yemen’s port of Mokha as well as reports on two other incidents near the Bab al Mandab strait according to Reuters.
• Above normal temperatures in NW and central Europe are expected to continue until the end of December.
• European natural gas storage was down to 88.84% full on Dec 16 according to GIE data compared to the seasonal five year average of 77.7% with warm weather driving smaller than normal withdrawals.
• Pipeline supplies into Europe from Norway are today up to 354.3mcm/d and just below the high of the year of 359mcm/d seen in late November.
• European LNG sendout was at 407mcm/d on Dec 16 and almost in line with the average seen over the previous week but remains below levels around 480mcm/d this time last year.
• Shell has resumed operations at its Prelude LNG facility off the west coast of Australia, with the first cargo scheduled be loaded within days, Reuters said, citing two industry sources.
• The Panama Canal Authority announced last Friday it will allow 24 ships to transit the waterway starting in January, up from 22 currently, it said in a statement, while slots for LNG tankers have been reintroduced for January, supporting LNG cargo traffic through the waterway next month.
• US LNG exports are currently more profitable to Asia in February 2024, March 2024 and April 2024 according to BNEF.
• Potential delays to new LNG import terminals in Germany may have limited impact on the near term bearish gas market but could increase the German gas hub premium to other markets according to ICIS.