TTF Gains on Cooler Weather and Red Sea Concern

Near term TTF gains amid increase LNG supply risks from rising tensions in the Middle East and with cooler weather in January. Front month fell to the lowest since early September on Dec 29 as winter supplies appear comfortable amid muted demand. Iran have sent a warship to the Red Sea after three Houthi boats sunk as the US responded to further vessel attacks over the weekend.

• TTF FEB 24 up 1.8% at 32.95€/MWh
• TTF SUM 24 up 1.9% at 32.9€/MWh
• TTF WIN 24 up 1.5% at 37.75€/MWh
• TTF SUM 25 down -1.8% at 32.68€/MWh
• Temperatures in NW and central Europe are forecast to cool during the first week of Jan. Temperatures are expected to fall below normal from around Jan 6 and remain cold into the middle of the month.
• European natural gas storage is holding well above normal at 86.51% full on Dec 31 according to GIE data compared to the seasonal five year average of 73.9% with below normal withdrawals throughout much of December.
• Soft demand and high storage have contributed to below normal recent European LNG sendout with the last week of Dec averaging around 350mcm/d compared to around 400mcm/d the previous year.
• Norwegian pipeline supplies into Europe remain strong and are today nominated in line with the average from the previous week at 352.6mcm/d.
• Gas transit flows through Ukraine are at 40.7mcm/d today and Algeria gas flow to Italy at Mazara are down to 49.7mcm/d.
• ICE TTF daily aggregate traded futures volumes were below normal at 139k on Dec 29.