For the first time in about a month, the prices on the TTF are swinging wildly back and forth. Substantial temperature differences cause instability on the gas market. The gas price will probably be slightly higher in the near future as a result of the colder weather. But falling mercury is not the only cause of gas price spikes. Disruptions in deliveries from Norway and the United States are also pushing up gas prices.
The gas price has been fluctuating between €100 and €125 for about three weeks. Once again, prices on the TTF fell into this pattern. Yet something seems to have changed. The price of the TTF is experiencing sharper rises and falls. On Thursday, November 10, gas cost €113,45. A day later, the gas price dropped to €97,85, the lowest price of the week. Two days later, on Wednesday, November 15, the price topped out at €123.
The price increases in recent days are mainly the result of colder weather. Until recently we were experiencing a very mild autumn. Because heating often fails, European countries saved record volumes of gas. In both October and early November, about 50% less gas was used than in previous years.
However, this sultry late summer weather will come to an end at the end of this week. Atypically low temperatures are predicted for this period for the first time this autumn. It therefore seems unlikely that the energy price will quickly move towards €100 again. However, there is no panic yet on the European gas market. The long-term prospects still point to a mild winter, various scientific institutes report.
Disruptions in the supply
The higher prices on the TTF are not only due to the lower temperatures. A number of supply disruptions also increase the gas price. For example, Norway, the largest gas supplier to the European Union, can temporarily supply less natural gas. A fire in the production facilities of the natural gas field threw a spanner in the works. The production disruption is likely to last from November 14 to 19.
Not everything is going smoothly in the field of LNG either. Liquid gas is making an increasing contribution to the European gas supply. However, since mid-October the supply to Europe has stopped. Initially, the disruption was an effect of the successful European energy strategy. The gas supplies were so full that in several places no LNG could flow into the gas network. In addition, the gas price reached such a low point that it was no longer profitable for suppliers to sell their gas on the European market. These disruptions have now come to an end.
After a period of stagnant LNG supplies, European countries are importing liquefied gas again to maintain their supplies. There is no question of a flawless restart yet. The United States, Europe's most important trading partner in the field of LNG, is unable to solve existing supply problems. Exports from the country's main terminal came to a standstill after an explosion in July.
The US normally ships about 15% of its LNG from this terminal. According to the original planning of the operator, Freeport LNG, the export port would resume exports in mid-November. However, on Tuesday, November 15, the company announced that the facility will remain out of operation for the time being. Due to this setback, the company is forced to discontinue various gas supplies to European countries.