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European benchmark gas prices continue their rally this week, hitting new highs on Tuesday at the equivalent of $ 205 a barrel of oil, as part of a wider rally in energy commodities driven by supply issues before winter.
The price of gas at the Dutch TTF hub, the benchmark gas price for Europe, soared to more than 100 euros per MWh on Tuesday for the first time, as gas and coal prices recover in Europe and Asia and that nuclear power generation in France fell due to a strike.
The energy crisis continues to worsen and no immediate relief is in sight, analysts say.
“Everything looks set for another week of price hikes, as fiercely nervous sentiment in the market persists over fears of reduced supply over the winter. The most traded contracts on the important Dutch hub TTF are again at all-time highs, and could easily continue the uptrend today, “Energi Danmark said in a note Tuesday.
According to Ole Hansen, Head of Commodity Strategy at Saxo Bank, the Dutch benchmark TTF gas index traded in the morning in Europe up 12% over the day to € 106.3 / MWh, the equivalent of $ 36 / MMBtu or $ 205 per barrel of crude oil.
The market is concerned about the energy supply this winter and ignored Monday’s news from Nord Stream 2 AG, the operator of the controversial Russia-led pipeline, which has started to fill the first chain of the pipeline with gas to fuel itself. prepare for the moment that the German authorities grant him an operating license.
With an uncertain start of Nord Stream 2, gas prices in Europe continue to rise, also due to cold forecasts in northern Europe and the drop in nuclear electricity production in France, due to a strike.
“All energy prices – coal, oil, gas, electricity – are up. There does not appear to be any slack in the rally,” a gas trader told Reuters.
By Tsvetana Paraskova for OilUSD
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