One more level seen since the historical record registered at the beginning of March, at the beginning of the Russian invasion of Ukraine.
The price of natural gas briefly exceeded 300 euros per megawatt hour (MWh) on Wednesday, a level not seen since the historical record registered in early March, at the beginning of the Russian invasion of Ukraine.
After rising to 302.995 euros per MWh, the Dutch TTF futures contract, a benchmark for the European natural gas market, has moved to 292.150 euros per MWh, around 16:00 GMT (18:00 Paris time). , pushed for several sessions by the suspensions of the next Russian supply. On Friday, the Russian gas giant Gazprom announced the complete suspension of gas supplies through Nord Stream 1 for a period of three days, from August 31 to September 2, for reasons of “maintenance“. Prices were also supported by weather conditions in Europe, between droughts and heat waves”,which has led to an increase in energy demand for air cooling“, explain the analysts of Société Générale.
They also cite among the upward factors the effort of European nations to replenish their natural gas stocks before winter, an even more ambitious undertaking”with gas flows still weak through the main gas pipeline that supplies Western Europe“. Since the beginning of the year, the price of TTF has skyrocketed and has quadrupled (+315%). On March 7, the contract had reached a record level at 345 euros per MWh. The recent rise in prices has also caused electricity prices to skyrocket for next year in France and Germany, falling short of the all-time highs reached earlier in the week.
Oil prices were hesitant after the weekly release of crude oil and gasoline inventories by the US Energy Information Agency (EIA). The barrel of Brent from the North Sea, a reference for crude in Europe, for delivery in October, advanced 0.27% to 100.53 dollars, returning to triple-digit prices. A barrel of US West Texas Intermediate (WTI) for delivery in the same month rose 0.86% to $94.55. During the week ending August 19, commercial inventories fell by 3.3 million barrels, while analysts had expected a drop of 2.5 million. Gasoline reserves, however, remained almost unchanged (-100,000 barrels), while experts expected a more marked drop. Traders have also held back the nearly 10% drop in gasoline demand, weighing on crude prices.
The market also had its eyes on the Iran nuclear deal, as Iran’s Foreign Ministry said on Wednesday that it had received a response from the United States regarding “settingsrequired by Tehran to the agreement proposal presented by the European Union (EU). The negotiations, which began 16 months ago, are aimed at saving the international agreement concluded in 2015, from which Washington withdrew in force in 2018 under the presidency of Donald Trump.
A positive result would lead to the lifting of part of the US sanctions against Iran and could allow this country to return to its full export capacity in the oil market. On Tuesday, Saudi Arabian Energy Minister Abdelaziz bin Salman said current prices could justify a production cut by OPEC+, the Organization of the Petroleum Exporting Countries and their allies. iraq hassubscribedto these statements, in a press release published this Wednesday on the website of the State Organization for Petroleum Marketing (SOMO), the state agency in charge of marketing Iraqi oil. However, this reduction would not be imminent and would depend on the outcome of the negotiations around the Iranian nuclear agreement.
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