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Analysis Natural gas

European gas price is recovering after decline

20 April 2022 - Jurphaas Lugtenburg

The situation on the European gas market remains tense. Relatively mild weather and a good supply of LNG caused the gas price to fall around Easter. Uncertainty about the supply of gas from Russia and maintenance work on gas fields in Norway, among other things, changed the mood in the market today (Wednesday 20 April).

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The gas quotation on the TTF has shown a steady decline in recent days. On Wednesday, April 13, the TTF closed at €105,32 per MWh. Yesterday (Tuesday April 19) this had dropped to €93,77 per MWh. That is the lowest level since the Russian invasion of Ukraine. Today, however, the price is rising again and at the time of writing the rate is €97,30 per MWh.

Uncertainty continues to dominate the market. Due to the relatively early milder weather, the demand for gas decreases, which is favorable for building up stocks. According to experts, energy companies should therefore be able to start filling the storage facilities earlier. They are further helped by the ample supply of LNG. The supply of gas from Russia remains a major concern for European policy makers. The focus is on the Kremlin's demand to pay for gas in rubles. If EU member states were to agree to this, they would violate the sanctions imposed by the EU, according to legal experts.

Russia will continue to supply
Gazprom will continue to supply gas to European customers. The state gas company reports that it is meeting the demand of European customers. This is also confirmed by the figures of the grid operators. However, the demand from European (energy) companies is smaller than before the Easter weekend. The supply of gas from Norway - the largest gas supplier to the EU after Russia - has also declined somewhat. This is due to (planned) maintenance work on various gas fields. On the other hand, the demand for gas to generate electricity is higher in the EU due to maintenance work on French nuclear power stations. The situation on the gas market therefore remains tense.

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