Article content
(Bloomberg) — European natural gas prices edged higher as traders assessed supply risks amid hot weather in parts of Asia and a hurricane approaching key fuel supplier Texas.
Benchmark futures rose as much as 1.7% on Monday. While Europe’s gas inventories are well-stocked for the time of year, the global market it relies upon has seen a number of disruptions lately, including unplanned outages and demand spikes caused by greater needs for air conditioning in some parts of the world. Prices have increased more than 20% since traders began stockpiling in April.
Article content
One risk the market is closely eyeing is the possibility that hurricane Beryl, which is expected to reach the Texas coast early on Monday, will cause interruptions to liquefied natural gas operations there. Freeport LNG’s liquefaction facility has already ramped down production, the company said. Meanwhile in Europe, an unplanned outage at the UK’s Tolmount platform is expected to last until late morning.
At the same time, hotter-than-normal temperatures are blanketing parts of Asia, which have raised demand for gas to generate electricity.
For now, Europe is benefiting from gas stockpiles that are higher than usual for the season, and an increase in flows from top supplier Norway. Temperatures are also expected to stay mild in the UK, Germany and France, the region’s biggest energy markets, over the coming week.
Dutch front-month futures, Europe’s gas benchmark, rose 1.3% to €33.49 a megawatt-hour at 9:31 a.m. in Amsterdam. The UK equivalent contracts also rose.
—With assistance from Stephen Stapczynski.
Share this article in your social network
Source link
