Last week reports claiming that Ukraine and Azerbaijan had sealed a ‘gas swap’ deal to keep gas flowing into Europe after 1 January 2025, when the Russia-Ukraine transit deal expires, shook the European gas market. Traders and other energy stakeholders trusted the report which soon emerged to be untrue. However, it did trigger large movements in the market with many selling their positions. According to reports traders dumped an estimated 5 TWh of futures on Dutch TTF, the European benchmark, prompting a ~10% fall in the prompt price. With no actual changes in the market, prices soon reverted to where they were trading on Friday. This week prices are yo-yoing between gains and losses as the narratives are once again focusing on the colder weather and geopolitical risks as the Norwegian gas maintenance comes to an end and storage levels remain high. The concern from the Tropical Storm Helene in the United States has eased as the latest forecast signals it will miss most of the producing regions in the western and central Gulf of Mexico as it strengthens into a hurricane.
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