European Gas Futures Slide as Russia Payment Standoff Recedes

Author of the article: Bloomberg News Verity Ratcliffe (Bloomberg) — European natural gas futures rose, with traders focused on supplies from Russia and the continent’s imports of liquefied fuel. The European Union on Monday said that companies can keep importing Russian gas without breaching sanctions, easing concerns that shipments from the bloc’s biggest provider might…
European Gas Futures Slide as Russia Payment Standoff Recedes

Author of the article:

Bloomberg News

Verity Ratcliffe

(Bloomberg) — European natural gas futures rose, with traders focused on supplies from Russia and the continent’s imports of liquefied fuel.

The European Union on Monday said that companies can keep importing Russian gas without breaching sanctions, easing concerns that shipments from the bloc’s biggest provider might be cut amid a payment dispute. 

But the market is grappling with the implications of the region’s increased reliance on LNG imports as buyers seek non-Russian supplies after the country’s invasion of Ukraine. 

The “EU gas market infrastructure was not built for receiving such large LNG inflows, and regional stresses are already manifesting themselves through record dispersions on local gas benchmarks,” Biraj Borkhataria, associate director of European research at RBC Capital Markets, said in a note. 

The UK is facing greater gas-storage limitations, stoking concerns that its LNG arrivals may be curbed in an effort to avoid over-stretching its infrastructure, which has buoyed National Balancing Point hub prices. 

EU Guidelines

The European Commission last week sent its revised guidelines to member states, noting that companies should make a clear statement that they consider their obligations fulfilled once they pay in euros or dollars, a spokesman said Monday. The announcement has helped to ease a weeks-long standoff between the bloc and Russia over energy supplies. 

Gas injections at storage facilities across Europe are returning to near-normal levels, which has steadied prices somewhat. 

“One of the reasons European storage has filled so quickly is that Asian LNG demand has been relatively weak in recent months,” RBC said in its note. 

Still, natural gas shipments to Europe via Ukraine were set to remain curbed on Tuesday. Flows via the Nord Stream pipeline to Germany, the biggest link delivering Russian gas to the EU, were expected to remain stable, near full capacity. 

Benchmark front-month futures rose as much as 5% to 97.50 euros per megawatt-hour after earlier dropping to the lowest level since April 19. The UK equivalent rose as much as 13% to 195 pence a therm. 

©2022 Bloomberg L.P.

Bloomberg.com

Financial Post Top Stories

Sign up to receive the daily top stories from the Financial Post, a division of Postmedia Network Inc.

By clicking on the sign up button you consent to receive the above newsletter from Postmedia Network Inc. You may unsubscribe any time by clicking on the unsubscribe link at the bottom of our emails. Postmedia Network Inc. | 365 Bloor Street East, Toronto, Ontario, M4W 3L4 | 416-383-2300

Read More

Total
0
Shares
Leave a Reply

Your email address will not be published.

Related Posts
Russian rockets destroy Ukrainian airbase in Kyiv region: Interfax quoting mayor
Read More

Russian rockets destroy Ukrainian airbase in Kyiv region: Interfax quoting mayor

This advertisement has not loaded yet, but your article continues below. Author of the article: Article content LVIV — Russian rocket attacks destroyed a Ukrainian airbase near the town of Vasylkiv in the Kyiv region on Saturday morning, Interfax Ukraine quoted the local mayor as saying. The rocket attacks also hit an ammunition depot, Vasylkiv…
Uber investigating ‘cybersecurity incident’ after report of breach
Read More

Uber investigating ‘cybersecurity incident’ after report of breach

Author of the article: Uber Technologies Inc said on Thursday it was investigating a cybersecurity incident, after a report that its network was breached and the company had to shut several internal communications and engineering systems. A hacker compromised an employee’s workplace messaging app Slack and used it to send a message to Uber employees…
Activist Bluebell Asks Glencore to Separate Its Coal Business
Read More

Activist Bluebell Asks Glencore to Separate Its Coal Business

Author of the article: Bloomberg News Nishant Kumar and Thomas Biesheuvel (Bloomberg) — Activist hedge fund Bluebell Capital Partners has asked Glencore Plc to separate its thermal coal business because it has become a barrier to investment. The hedge fund firm said that the commodities giant could realize more value for shareholders if it separates…