European gas prices edged closer to fresh five-month lows in Thursday trading as comfortable supply and waning demand weighed on the market.
The benchmark Dutch TTF front-month contract was last trading down EUR 0.28 at EUR 30.66/MWh on Ice Endex. Earlier, it slumped to EUR 30.10/MWh, only marginal higher than 2 January’s intraday low of EUR 30.03/MWh – which was the lowest since 24 August.
The equivalent UK NBP contract was 0.28p lower on the day at 76.85/th.
“Everything seems to be relatively comfortable,” said Craig Lowrey, principal consultant at Cornwall Insight, referring to sufficient supply and forecasts for milder weather next week.
While temperatures next week across northern Europe would still be 1-2C below seasonal norms, southern and western parts could experience as much as 3C above usual for the time of year, according to forecaster SMHI.
“As far as storage is concerned, that’s still very healthy,” Lowrey said.
European gas storage facilities were seen last at around 83% of capacity, in line with levels a year ago, Gas Infrastructure Europe data showed.
On the supply front, Norwegian nominations were still relatively buoyant at 353mcm/day, TSO Gassco data showed.
There was also little risk of a near-term slowdown in LNG availability, with competing Asian demand for the chilled fuel weak, Lowrey said.
“Asian LNG demand and prices will always be the wildcard, but they seem to be experiencing the same drivers as Europe, with ample stocks [and muted demand],” he said.
European LNG prices sank to a near five-month low this week, below USD 9/MMbtu, Montel reported.
Tom Hovik, Montel’s head of technical analysis, reckoned the TTF benchmark could test EUR 28-29/MWh next week.