You can’t win the European gas prices race: TTF prices more than doubled since end of October, reaching a record of $45/mmbtu today.
No day-ahead nominations on Yamal (-30 mcm/d) provided certainly a boost, together with the rapidly deteriorating storage picture.
High gas prices will certainly translate in the short-term to some hefty profits on the balance sheets of gas producing companies, but in the longer-term there is really no winners here:
(1) high gas prices put at risk the global economy, still recovering from the covid crisis. this would have repercussions on producing economies as well;
(2) skyhigh gas prices are pushing up fertilizer prices to new records, putting at risk food supply security;
(3) the image of gas as an abundant, cheap and available energy source is certainly being damaged these days.
No one can win this race, even if TTF displays a record $6/mmbtu vs Asian spot LNG….
What is your view? How will this play out? Second round of the winter is approaching…
Source: Greg MOLNAR
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