AGT January 22 and February 22 at all-time highs of nearly $ 30
European gas surges in cold weather, supply constraints
Everett LNG Terminal Imports Single Cargo Winter To Date
Winter season gas prices at the city gates of Algonquin in Boston have risen sharply in recent trading sessions as the futures market responds to a recent surge in European gas and LNG import prices.
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On December 20, Algonquin’s gas contracts in January and February peaked this season, reaching $ 29.63 and $ 27.89 / MMBtu, respectively, according to the most recent M2MS data from S&P Global Platts.
The surge in prices in the New England gas market, which historically depended on LNG imports during the peak winter heating season, comes as the prices of onshore gas and LNG imports into Europe hit record highs .
At the benchmark Dutch TTF hub in Europe, gas prices topped $ 59 / MMBtu during December 21, marking the highest settlement on record since 2008. 21, topping $ 58 / MMBtu, according to data from S&P Global Platts.
In Europe, spot gas supplies have tightened over the past week as unusually cold weather hits Russia, leading to reduced gas flows to Western Europe. As Russian suppliers assess the country’s domestic demand needs, they reserved recent pipeline nominations exclusively for capacity auctions back in the day, leaving the European market on edge, S&P Global Platts reported previously.
The rise in gas prices in Europe has also shaken things up on import prices in Northeast Asia. On December 21, the JKM Platts was valued at $ 44.19, up about $ 2.50 / MMBtu on the day.
Steadily rising global gas prices are likely signals another daily increase in winter futures prices at Algonquin. At the time of publication, S&P Global Platts’ M2MS futures curves for December 21 were not yet available.
New England Market
The rise in futures prices in New England is explained by a recent and sharp drop in spot prices.
On December 21, Algonquin town gate spot prices were trading at just over $ 10 / MMBtu – up about $ 2 on the day, but down from levels above $ 38 at the start of the week, according to data from the Intercontinental Exchanged.
Short-term forecast from Platts Analytics shows New England gas demand to accelerate through the end of the week and into the holiday weekend in a likely upward turn for the market in Canada. cash.
So far this winter, New England has received just one shipment at the region’s Everett LNG import terminal, which delivered the regasified equivalent of about 2.9 billion feet. cubes on November 3.
From November to March last season, Everett received seven shipments carrying 20.5 billion cubic feet. During the 2019-20 season, the terminal took on nine cargoes carrying nearly 23.5 billion cubic feet, according to data from Platts Analytics.
A seasonal outlook update from the US National Weather Service predicts a 40-60% chance of above-average temperatures in New England from January through March, with the long-term bearish outlook potentially putting the needs of the region into question. in imported supply this winter.
Following the recent surge in futures prices at Algonquin, however, it appears New England gas traders are still keeping a close eye on global markets as they likely prepare to compete in the global LNG arena for additional cargoes in high season.