European gas prices again exceed $500/1,000 cubic meters; Gazprom requests 42.4 mcm for transit via Ukraine
MOSCOW. March 10 (Interfax) - The spot price for gas in Europe has added 6% immediately over the past day, again exceeding $500 per thousand cubic meters, thereby possibly supporting growth in Asian prices, along with the widening effect of the strike at French LNG terminals.
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, and the figure was 42.4 mcm of gas the previous day, data from the 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 March 10, with booking via the Sokhranovka metering station declined," Gazprom spokesman Sergei Kupriyanov told reporters.
The 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 that there are no grounds for the force majeure or obstacles to continuing operations as before.
EUROPEAN MARKET
The day-ahead contract for today at the Dutch TTF gas hub in the Netherlands closed at $501 per thousand cubic meters.
A split between LNG prices in Asia and those in Europe has noticeably returned. In Asia, the most expensive futures contract for April on the JKM Platts index is $496 per thousand cubic meters, and futures under the LNG North-West Europe Marker are $511 per thousand cubic meters.
Wind turbines provided 13% of the region's electricity needs last week, have provided 16% this week according to WindEurope.
EUROPEAN INVENTORIES
Current inventory levels in Europe's underground gas storage (UGS) facilities have declined to 57.54%, which is 21 percentage points above the average for the same date over the past five years, according to Gas Infrastructure Europe.
Inventories contracted 0.5 percentage point during the gas day for March 8. The weather forecast called for slightly colder temperatures this week, resulting in increased offtake from UGS facilities.
The relatively mild weather in October, November and January, in addition to the continent's austerity measures, have resulted in the level of inventories in UGS facilities being at an all-time high for this time of year since monitoring began, thereby underpinning the authorities' confidence in getting through the winter in good shape.
European LNG terminals operated at 63% capacity in February, and the figure has been 66% since the start of March.
U.S. INVENTORIES
The state of gas in UGS facilities in the United States is of increasing importance for the global market, and the country is actively increasing gas exports, primarily to Europe.
Inventories decreased 2.4 billion cubic meters for the latest reporting week, which is markedly less than the usual offtake for this time of the year.
The current level of inventories is around 42%, which is 21 percentage points higher than the average figure for the past five years, according to the U.S. Energy Department's Energy Information Administration. The current level of inventories is close to the highest figure for the past five years.
Freeport LNG, the United States' largest LNG plant, has announced reopening all three liquefaction lines, thereby reducing the excess gas on the U.S. market and boosting supplies of LNG to the global market.