Shotaro Tani of the Financial Times reports that an unusual price relationship for natural gas, in which prices will be higher during the summer than the winter, could make it harder to refill EU storage as Russian supplies dwindle. Tani writes:
European gas traders expect prices next summer to be higher than the following winter, an unusual bet that reflects the steep cost of refilling the continent’s storage facilities as it tries to wean itself off Russian supplies.
Natural gas in Europe has historically tended to be cheaper in the summer when demand is lower. That has incentivised traders to buy in the hotter months and store gas to sell at a profit during the winter peak heating season. […]
If the summer price premium persists, EU regulators are likely to mandate the purchase of more gas, said analysts at consultancy Energy Aspects. […]
The high summer gas price is a reflection of traders “speculating that the government will intervene again and fill storages at whatever cost, even if it is unprofitable”, said a gas trader.
Read more here.
