EUROPE GAS-Price slip as storage fills and traders take profits
LONDON, Aug 30 (Reuters) - British and Dutch wholesale gas prices eased on August 30 as Europe almost reached its target of gas inventories being 80% full and profit-taking following record high prices last week.
The British day-ahead gas contract fell by 110 pence to 460 p/therm by 0928 GMT and the September price was 135 pence lower at 460 p/therm.
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In the Dutch market, the September TTF contract was down 12 euros at 255 euros per megawatt hour (MWh) and the Q1 2023 price was 82.5 euros lower at 263 euros/MWh.
Despite Tuesday's dip the Dutch front-month gas contract remains some 420% higher than this time last year.
German Economy Minister Robert Habeck said on Monday he expects gas prices to fall soon as Germany, Europe’s largest gas consumer, is making progress on its storage targets and won't have to pay the high asking prices to continue replenishing stocks.
“We believe the drop could start now, thanks to competition between financial participants to liquidate their long positions and avoid to be the last idiot obliged to sell at a much lower price,” analysts at Engie's EnergyScan said on Tuesday.
European gas storage was almost 80% full close to an EU target to be 80% full by November 1.
Russian gas flows to Europe via the Nord Stream pipeline and via Ukraine remained steady on Tuesday, operator data showed.
Russia will halt natural gas supplies to Europe for three days via its main pipeline into the region Nord Stream from Aug. 31 -Sept. 2 while it carried out maintenance, Russian energy giant Gazprom has said.
The shutdown follows a 10-day maintenance curtailment in July and the Nord Stream pipeline had already been running at just a fifth of its capacity, stoking fears that Russia could halt flows completely heading into the winter heating season.
Another factor adding to bearish prices could be that Germany will discuss how to break the extreme spiral in gas and power prices with other European Union members at an emergency energy ministers meeting on Sept. 9.
"Any action which caps power prices will limit the profitability of burning gas for power generation which could possibly feed through to lower gas demand," said ING analysts.
Meanwhile France’s Engie, said on Tuesday it had been informed by Gazprom it’s deliveries of gas would be reduced in a dispute over contracts.
In the European carbon market, the benchmark contract was down 3.26 euros at 83.40 euros a tonne.