Market updates and forecasts

Get the latest economic news from ForexMart, including updates on the financial market, central banks' policy announcements, financial indicators, and other relevant news which can have an impact on the industry.

Disclaimer:  Information provided here to retail and professional clients does not contain and should not be construed as containing investment advice or an investment recommendation or an offer or solicitation to engage in any transaction or strategy in financial instruments. Past performance is not a guarantee or prediction of future performance.

Gas prices in Europe continue to rise. Why?


October, 11 2023
watermark Economic news

Prices for winter gas futures in Europe have increased by 25% in recent days, reaching more than $600 per thousand cubic meters.


Prices for gas supplies in the period from November to April added $120/thousand cubic meters on the Dutch TTF exchange. At the same time, prices «for the day ahead» jumped by 29% from Friday to €49/MWh ($550 per thousand cubic meters). Futures prices for December-March rose slightly less, by 23%, to just above $600 cubic meters. 


In principle, analysts expected growth to $600, but not before the cold weather comes to the northwest of Europe. What are the main reasons for the price increase right now? 


  • Firstly, there are risks of strikes at two Australian LNG plants starting this Friday, which could lead to the loss of up to 7% of global LNG production capacity.


  • In addition, gas supplies from a field near Gaza in Israel were stopped, which reduced the export opportunities of Egypt, where this gas was usually sent. 


  • Another factor was the calm, windless weather in northwestern Europe, which caused a sharp increase in gas electricity generation.


  • The heating season begins in Germany on Sunday, and although it is still relatively warm in October, a sharp drop in temperature to 0-10 °C is expected by the weekend.


Experts note that the European gas market is overly sensitive to any fluctuations in supply and demand, especially on the threshold of the heating season. This is a good signal for Gazprom, whose shares are trading with a P/E multiplier, which is now 12% below the historical average.


Feedback

ForexMart is authorized and regulated in various jurisdictions.

(Reg No.23071, IBC 2015) with a registered office at Shamrock Lodge, Murray Road, Kingstown, Saint Vincent and the Grenadines

Restricted Regions: the United States of America, North Korea, Sudan, Syria and some other regions.


© 2015-2024 Tradomart SV Ltd.
Top Top
Risk Warning:
Foreign exchange trading carries a high risk of losing money due to leverage and may not be suitable for all investors. Before deciding to invest your money, you should carefully consider all the features associated with Forex, as well as your investment objectives, level of experience, and risk tolerance.
Foreign exchange trading carries a high risk of losing money due to leverage and may not be suitable for all investors. Before deciding to invest your money, you should carefully consider all the features associated with Forex, as well as your investment objectives, level of experience, and risk tolerance.