Near Term TTF and Curve Prices Support by Gas Supply Risks

The Europe gas market remains nervous ahead of winter with upside risk from supply disruptions and cold weather. Spot gas price movements are having a greater impact on the forward curve with longer dated contracts more closely following near term moves.

• The Q1 2024 -Nov 2023 spread is holding relatively steady this week at 5.8€/MWh today and with Q1 2025- Q1 2024 at 1.3€/MWh.
• European gas prices have seen support in recent weeks from the potential Balticconnector gas pipeline sabotage and the rising risks from the Israel-Hamas conflict.
• “A lot of things going on at the same time, underpinning gas prices,” said Trevor Sikorski of Energy Aspects. He noted the added market risk despite the limited impact on TTF of the Balticconnector outage. “If this can happen in the Baltics, why can’t it happen for important infrastructure, such as Norwegian infrastructure?” he said. The pipeline repairs are expected to take 5 months to the earliest in April according to Gasgrid Finland.
• Shipping restrictions via the Suez Canal due to an escalation of the Middle East conflict would increase gas volatility with 16% of European LNG using the route in 2022. A complete stoppage of fuel transport was unlikely according to Montel sources.
  • TTF NOV 23 up 3% at 51.66€/MWh
  • TTF Q1 24 up 1.1% at 57.38€/MWh
  • TTF SUM 24 up 0.6% at 55.1€/MWh
  • TTF WIN 24 up 0.8% at 58€/MWh