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Kommersant: Fuel prices in Europe decline amid LNG purchases and increased storage Due to ample supplies of liquefied natural gas (LNG), which has led to some excess, and substantial storage stocks, gas prices in Europe continue to decline. The price for November has so far settled at about $1,300 per 1,000 cubic meters as gas futures have stabilized. Up till the end of October, warmer-than-normal weather is expected, which will also keep costs low for the time being, Kommersant writes. European gas storage facilities are now 92.66% full, which is significantly higher than the five-year average. However, the EU fears that the replenishment of stocks by next winter (2023-2024) will be difficult if supplies from Russia stop completely. Warmer October weather also contributes to lower prices for now, as underground gas storage (UGS) facilities continue to inject gas, although usually by October 20, storage facilities are used for withdrawal. According to Sergey Kondratiev from the Institute of Energy and Finance, a decrease in gas prices to the level of $1,100 - 1,200 per 1,000 cubic meters could pave the way for a 5-10% increase in demand compared to the current level, primarily in energy-intensive sectors like metallurgy, the manufacture of building materials, and gas chemistry. However, according to the expert, the EU's objective of limiting demand makes large consumption growth unlikely. |
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Source
20 Oct 2022
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