Temperatures forecast to plummet in Europe; Gazprom requests 42.4 mcm transit via Ukraine
MOSCOW. Nov 10 (Interfax) - The unusually mild weather in Europe is set to change, with temperatures forecast to fall significantly below the average for the time of year from the middle of next week.
Gazprom's request for pumping Russian gas through Ukraine has not changed markedly from the previous days and months.
UKRAINIAN TRANSIT
The Gas Transport System Operator of Ukraine, or GTSOU, has accepted a booking from Gazprom today to transport 42.4 million cubic meters of gas through the country, as on Wednesday, data from GTSOU show.
Capacity was requested only through one of two entry points into Ukraine's Gas Transport System, the Sudzha metering station. A request was not accepted through the Sokhranovka metering station.
"Gazprom is supplying Russian gas for transit through the territory of Ukraine at the volume confirmed by the Ukraine side via the Sudzha metering station at 42.4 mcm on November 10, with booking via the Sokhranovka metering station declined," Gazprom spokesman Sergei Kupriyanov told reporters.
GTSOU has declared a force majeure with respect to acceptance of gas for transit through Sokhranovka, claiming that it cannot control the Novopskov compressor station. The route through Sokhranovka had provided transit of more than 30 mcm of gas per day.
Gazprom believes there are no grounds for the force majeure or obstacles to continuing operations as before.
EUROPEAN MARKET
The delayed, yet unavoidable, seasonal drop in temperatures has restored gas prices on the European market. The day-ahead contract for Wednesday at the TTF hub in the Netherlands closed at $905 per thousand cubic meters, which is more than four times the price of $225 per thousand cubic meters a week ago. The December futures contract on the TTF index currently costs $1,145 per thousand cubic meters.
Wind turbines have generated 23% of the EU's electricity on average this week following 18% on average last week, according to data from WindEurope.
The Nord Stream pipeline has been fully shut down owing to a number of sanctions-related problems regarding equipment maintenance. At the end of September, two lines of Nord Stream 1 and one line of Nord Stream 2 depressurized near the Danish island of Bornholm.
EUROPEAN INVENTORIES
Europe is poised to begin net offtake of winter gas stocks, with injection only a fraction of a percent over the past few days.
The beginning of offtake season this year will be the latest since Gas Infrastructure Europe began monitoring in 2011, with the previous latest date coming on November 4, 2013.
Inventories in UGS facilities are currently 95.36%, up 0.02 percentage points from November 8, the last reporting date, according to Gas Infrastructure Europe data. Over 102 bcm of active gas have accumulated in UGS facilities. Net offtake was seen in France, Italy and Poland during the November 8 gas day.
"The load on UGS facilities in Europe will be higher than in previous years owing to the changed logistics and sources of gas supplies to the European market." Gazprom has also cautioned.
In response to the lower temperatures, European LNG-receiving terminals have boosted regasification volumes, and the capacity-utilization factor has been 64% since the beginning of November against an average of 60% in October.
U.S. INVENTORIES
The U.S. dramatically increased the rate of injecting gas into storage facilities during the last reporting week. In the week ending October 28, some 3 billion cubic meters of gas had been accumulated, which was double the previous week, and overall again in line with the average injection rate this autumn.
Nevertheless, the current level of inventory is below 73%, which is substantially lower than inventory at UGS facilities in Europe and in Russia.
UGS inventories in the U.S. are now 11% above the five-year minimum, according to the U.S. Energy Department's Energy Information Administration. Current inventory now lags 4% behind the five-year average.