The TTF continues to fluctuate about the 100 EUR/MWh (~$33/Mmbtu) mark, and now appears to exhibit a slightly bullish skew after several days of bearish sentiment.
Some of the upside moves could be stemming from the unplanned outage at Troll due to a compressor failure, leading to a ~5.8% day on day drop in Norwegian flows to the continent.
The weather outlook in Europe has also turned remarkably colder, with expectations of an approaching cold front, only partially offset by restored nuclear output in France.
Russian flows ticked marginally upwards by ~3.1% day on day, averaging ~215 MCMD.
Gazprom booked very little additional export capacity to Europe for April, largely in line with market expectations.
Storage volumes in the EU are currently at 26%, well under the 90% target for October.
In order to reach that target while phasing down dependence on Russian gas, EU countries have agreed to start jointly purchasing gas, LNG and hydrogen.
This brings the EU’s position in line with that of Spain and France which had been requesting such a measure since 4Q 2021.
If implemented, it will help mitigate risk of a runaway surge in gas prices stemming from inter-country competition for very limited molecules.
TTF prices might also be influenced by some bullish momentum from oil prices: Brent crude has gone back over $ 115/Bbl as the EU considers an embargo on Russian oil (even as different states remain divided on this) and reports of repeated Yemeni Houthi rebel attacks on Saudi energy infrastructure have surfaced, adding to concerns over an already constrained oil supply.
In Asia, regional fundamentals are currently governed by power shortage concerns in Japan, where over 3GW of thermal capacity is still offline after the earthquake on March 16 and temperatures are dropping .
In addition, around 600MW of coal-fired capacity near Tokyo was taken offline on Mar 20, with the re-start schedule unclear.
These developments are likely supporting LNG prices that have until recently followed the TTF’s downward trajectory.
Regional coal fundamentals also remain very tight due to heavy rainfall in Indonesia and flooding in Australia, despite the ~5% week on week drop in Newcastle prices.
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