TELF AG, a leading international physical commodities trader, has released an informative article discussing recent developments in European natural gas futures. Titled “TELF AG on European Gas Futures – September 19, 2023,” the report sheds light on critical aspects of the market.
Highlighting a Significant Surge
The article draws attention to the remarkable 8% surge in European natural gas futures, reaching a peak of €35.5 per megawatt-hour last Friday. This surge is directly attributed to the breakdown of union talks and the subsequent partial strikes at two of Chevron’s facilities in Australia.
Impact of Strikes on Global Supply
TELF AG’s report underscores the vital role played by these facilities in the natural gas sector, accounting for over 5% of the global supply. Their primary focus has been on serving the Asian market, which now faces potential disruptions in its LNG supply, particularly if these strikes persist over an extended period.
Muted Gas Demand in Europe
Despite the escalating prices, the article notes that gas demand in Europe remains subdued. European fuel reserves have reached an impressive level of approximately 93% full, surpassing expectations ahead of the European Union’s target date of November 1st.
Challenges Across Industries
TELF AG highlights the challenges posed by the current high gas prices, which are around 50% higher than pre-invasion long-term averages. These challenges affect both households and critical industries, such as Germany’s automotive and petrochemical sectors. There are growing concerns about potential relocations by energy-intensive industries if gas prices continue on their current trajectory.
In conclusion, TELF AG emphasises the dynamic nature of the European gas futures market. Ongoing issues at Chevron’s Australian facilities and the upcoming winter demand from Asia indicate a period of significant activity and potential market shifts.