TTF gas prices surge 15% on global supply disruptions
Quantum Commodity Intelligence – European natural gas prices surged another 15% Thursday, maintaining the firm solid weekly uptrend as traders monitored a number of global supply disruptions heading into the crucial northern hemisphere winter.
Outages have already been confirmed for Israel's primary offshore gas source, while suspected sabotage has closed an undersea pipeline in the Baltic and unions representing Chevron workers at two LNG processing plants in Australia have served a strike-action notice.
Benchmark TTF futures for Nov23 settled Thursday 15% higher at €53.002/MWh, close to the day's high of €53.30/MWh, while Dec23 was up 12% at €55.04/MWh.
The key TTF winter contracts for Jan24 and Feb24 also posted double-digit percentage gains to settle above €56/MWh.
Israel's government ordered Chevron to halt operations at the 10 billion-plus cubic metre/year Tamar field for safety reasons on Monday, which Goldman Sachs sees as a potential tightening of equal size to a major disruption event in global LNG markets.
The Tamar gas field is one of regions primary sources of energy, producing gas for domestic use as well as sales into Egypt and Jordan.
Meanwhile, speculation focused on sabotage for the outage on the 77-kilometre undersea Balticconnector gas pipeline, which links Finland and Estonia, but officials are continuing the investigation.
Analysts said that even if the leak turns out to be mechanical, it could take many months to restore to full capacity.
"If it turns out that the leak is due to deliberate sabotage, it obviously raises significant concern for European energy security and highlights the potential vulnerability of other European pipeline infrastructure, particularly as we head into the winter months," said Warren Patterson, head of ING's commodity research.
Unions representing members at Chevron's Gorgon and Wheatstone plants in Australia gave notice Monday to resume industrial action, including strikes from 19 October, after accusing the energy giant of reneging on a deal negotiated last month.
