TTF prices surged by more than 30% since late June to open well above €50/MWh this morning—their highest level since early April. Meanwhile, JKM prices surged to above $18.5/MMBtu.
Renewed tensions in the Gulf are providing upward pressure on gas prices. In addition, more cooling needs in Asia amid super El Niño are set to drive up electricity demand, which in turn could support more gas-fired power generation, with gas often being the marginal fuel.
In Europe, a hot summer is already supporting more gas burn in the power sector, while the EU will need to speed up its storage injections if it wants to reach its 80–90% fill target.
In this context, competition for flexible LNG is set to heat up between the two main demand centres, while South America is also out there to compete amid lower hydro availability.
Source: Greg Molnar
