As a result of the restarting of US exports from America’s second-largest liquefied natural gasoline terminal, gas prices in Europe fell to levels not seen since September 2021.
After an explosion, the Freeport LNG terminal in Texas had to be shut down on June 8. The terminal is currently resuming some of the liquefaction operations. This will require regulatory approval. A BP-operated LNG tanker took a cargo of gas from Houston’s storage tanks to make room for new production.
However, he said that Freeport is far from being fully operational and that the Russian pipe supply was very limited. This would result in European prices remaining high for a while.
Late last summer, gas prices soared to record highs with UK prices of 600p per therm. This was due to Russia’s restriction on supplies to Europe. After an unusually warm winter, storage sites were less depleted than anticipated, prices have since fallen.
Yesterday’s trading of Europe’s TTF gas benchmark contract fell by 4% to less than EUR52 per megawatt hour. The benchmark month-ahead gas price fell by around 4% to 129p per thermal. This was the lowest UK gas price since last summer. This is more than twice what it was a decade ago, however.
Tom MarzecÂManser, head for gas analytics at Icis (the price reporting agency), said that “the restart of LNG exports to the US Freeport plant over the weekend has driven wholesale gas prices lower in Europe on Monday. Although prices have fallen a lot in recent weeks due to mild weather, lower demand, and continued hefty LNG imports, they are still quite high and far above what we were able to see before Covid.
However, he said that Freeport is far from being fully operational and that the Russian pipe supply was very limited. This would result in European prices remaining high for a while.
