Producers of liquefied natural gas (LNG) from the United States annoy Gazprom, writes Kommersant. The expectation of their deliveries restrains the growth of world gas prices, the main supplier of which to Europe has been the Russian concern for many years.
The unusually cold weather for February in Europe and low stocks in storage did not lead to a prolonged rise in gas prices. Their rise in early January was short-term. At the time of publication, the futures for the March delivery of one megawatt-hour on the London ICE exchange cost 18.8 euros, which roughly corresponds to $ 250 per thousand cubic meters.
This price is 30 percent below the two-year high set at auction on January 12th. The relatively low level of prices remains, despite the sharp reduction in stocks in storage, which resulted from the policy of “Gazprom”. Most of the tanks belong to him, and the company deliberately did not increase the volume of supplies to Europe, and also canceled trading on its own electronic platform in order to force traders to take gas from the storage facilities.
Analysts interviewed by the publication note that in a normal situation, this state of affairs would lead to a sharp rise in prices, but in fact it turned out to be short-term. This is mainly due to the situation in the Asian market. Due to the abnormal cold weather in the region at the beginning of winter, the cost of gas at local hubs has risen to a record, prompting the world’s largest traders to supply there liquefied natural gas (LNG), which is easier to transport, – mainly American.
However, the situation should change dramatically soon. Prices in Southeast Asia are gradually declining, which will make the sellers of US LNG once again able to compete with Gazprom’s pipeline gas in Europe. It is the expectation of an early start of supplies from the United States that puts pressure on prices, preventing them from growing. Under these conditions, Gazprom maintains the tactics of artificially emptying reserves in storage facilities.