Mid-Day Gas Summary: TTF Trades Higher

TTF is holding onto gains this morning supported by escalation in the Middle Eastern conflict. Upside is limited by high storage levels, warm weather and comfortable supplies.

• TTF FEB 24 up 1.5% at 28.51€/MWh
• TTF SUM 24 up 1.8% at 29.46€/MWh
• Yemen’s Houthi rebels launched a missile attack on Friday that sparked a fire on a fuel tanker operated by Trafigura, carrying Russian naphtha, raising concerns that attacks on Red Sea shipping are expanding and not just confined to US, UK or Israeli linked ships.
• Temperature forecasts in NW and central Europe are showing above normal is expected for the coming week but could drift back to near normal during the second week of the outlook.
• Norwegian pipeline supplies to Europe are stable with today nominated up to 348.3mcm/d and in line with the average seen during January.
• European natural gas storage is still up at 72.02% full on Jan 27 according to GIE data compared to the seasonal five year average of 59.3% with net withdrawal rates declining since mid Jan.
• The European Union is expected to end the heating season in early April with around 53% of gas in storages, slightly below 2023 levels of 55.4%, Berenberg said in a note.
• LNG imports into Europe and Turkey were last week at 3.6bcm just below the eight month high of 3.8bcm from the previous week according to Kpler data via Montel. Imports are forecast to fall 40% this week to nearly 2.2bcm as demand remains weak.
• European LNG sendout was down to 312mcm/d on Jan 27 compared to an average of around 384mcm/d so far in Jan.
• QatarEnergy has signed a deal with Excelerate Energy Inc to supply LNG to Bangladesh for 15 years according to Bloomberg.
• Construction of Russia's planned new Power of Siberia-2 gas pipeline to China could be delayed according to Mongolian Prime Minister L. Oyun-Erdene via FT.
• The Biden administration’s decision to pause approvals of new LNG export permits is potentially delaying five planned US LNG export projects with a total capacity of 62mtpa that have already signed binding and non-binding supply deals according to the Center of Global Energy Policy.
• The 2024 global gas demand is forecast close to the average growth rate displayed during 2010-21 but only about half of that growth is structural according to IEA analyst Greg Molnar.