Yakov Grabar
Add to Bookmarks
Natural Gas

If Q2 2021 European gas market can be accompanied by a soundtrack, it will definitely be ‘Right Here, Right Now’ by Fatboy Slim. The name of that song accurately describes the dynamism of things taking place since the very beginning of this year’s gas summer.

Following the reversal in injections into the gas storages, Europe is already experiencing lower production from the NCS. Norwegian maintenance, that has started during the second ten days of April, represents the first significant decline in gas supplies to NWE since January, when players lost access to LNG amid soaring Asian premium and vessel shortages.

Know where Natural Gas is headed? Take advantage now with 

Trading Derivatives carries a high level of risk to your capital and you should only trade with money you can afford to lose. Trading Derivatives may not be suitable for all investors, so please ensure that you fully understand the risks involved, and seek independent advice if necessary. A Product Disclosure Statement (PDS) can be obtained either from this website or on request from our offices and should be considered before entering into a transaction with us. Raw Spread accounts offer spreads from 0.0 pips with a commission charge of USD $3.50 per 100k traded. Standard account offer spreads from 1 pips with no additional commission charges. Spreads on CFD indices start at 0.4 points. The information on this site is not directed at residents in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.

Over a period of two and a half months, the regional market is expected to be short 4.9 bcm of supplies from Norway, most of which fell between April and May. Q2 daily gas exports from the country are expected to be constrained by 18% on average as compared to the levels seen in late March.

2021 Norwegian outages are developing according to their usual timing, in contrast to last year. In 2020, the works on the fields and processing plants were postponed until Q3 due to Covid restrictions, thereby extending a series of outages initiated by the planned shutdowns of Nord Stream and Yamal pipelines. It assisted in clearing a part of oversupply, laying a foundation for the subsequent growth in prices.

What influence Norwegian maintenance will have on the market environment this time? This is not a simple question, given the need for filling up storages on the one hand and favourable conditions for Europe-bound LNG deliveries on the other. As of now, the most that can be said is that the longer UGSs do not go into injection mode, the stronger will be the effect of Norway’s lower supplies throughout this quarter.

The opinions expressed in this blog are mine only and do not reflect the views of my employer.

For a look at all of today’s economic events, check out our economic calendar.

Don't miss a thing!
Discover what's moving the markets. Sign up for a daily update delivered to your inbox

Trade With A Regulated Broker