American natural gas prices rose by around 3% in the early morning, with the front-month jumping up 11 cents to $3.91/MMBtu. Forecasts in Week 2 skewed colder from yesterday’s model runs, adding around 5 Bcf to expected demand over the next 14 days, driving domestic prices higher.
Abroad, European prices have reached record levels, with the Dutch TTF zooming past its previous high at ~$39; latest market activity indicates that the TTF is trading at around $42 as colder weather hits the gas hubs in Europe.
Asian prices, on the other hand, which have competed to outbid European gas buyers throughout the fall, are currently trading at $35, nearly $7 below the TTF.
Price volatility on the other side of the world will remain high given the tight market conditions abroad. European prices, in particular, run the risk of trading at even higher levels in the event that further cold materializes on longer-term forecasts.
Source: Gelber and Associates
