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Warm temperatures and a steady stream of LNG imports are keeping European gas prices fairly calm, despite a slight nudge upwards on December 10, 2024.
What does this mean?
The European gas market is riding a wave of mild weather and substantial LNG deliveries, with Dutch and British gas prices remaining mostly stable. On the Dutch front, the TTF hub's benchmark contract edged up to 45.10 euros per megawatt hour, while the British day-ahead contract increased to 112.00 pence per therm. Analysts at Engie EnergyScan highlight a mixed short-term outlook, with warmth and LNG schedules offset by a temporary disruption at Norway's Asgard gas field. Additionally, Europe's gas demand for power generation is expected to climb due to low wind output and the Norwegian outage, which could lend some price support. Meanwhile, Britain's anticipation of eleven LNG cargoes arriving over the next 17 days signifies a robust influx, while Gazprom maintains a stable supply of 42.4 million cubic meters through Ukraine. Lastly, the European carbon market saw its benchmark price tick up slightly, adding 0.54 euros to reach 66.91 euros per metric ton.
The European gas market's steady prices underline the crucial roles LNG imports and weather patterns play. With eleven cargoes set to dock in Britain shortly, the influx supports market stability. However, disruptions like Norway's Asgard field outage, combined with strong gas demand for power, highlight potential volatility. Investors should monitor these dynamics closely, as they could sway future pricing.
The bigger picture: A shift in the energy landscape.
The European energy scene is gradually adapting, juggling renewable challenges with traditional gas supplies. As global temperatures ebb and flow, LNG's role as a stabilizer becomes more crucial. Meanwhile, the slight hike in European carbon prices indicates a continuing shift toward a more environmentally conscious market, with carbon pricing playing a key part in shaping future energy strategies.