European gas prices rise sharply due to outage in Norway

Wholesale gas prices on the European market rose sharply today, climbing to around a one-month high. They were driven higher by an extension of the maintenance shutdown at a Norwegian gas field. At around 16:00 CEST, the price of the key October-delivery gas futures contract at the Title Transfer Facility (TTF) virtual trading hub in the Netherlands was up around ten percent, trading near 44 euros (roughly Kč 1070) per megawatt-hour (MWh).

Norwegian gas company Gassco extended the shutdown at the Skarv gas field this morning until 8 October. Over the weekend, it had already postponed the restart until 2 October. “This means Norwegian supplies will be lower than expected, limiting the filling of storage facilities,” said Marina Tsygankova, an analyst at LSEG. However, analysts at Engie said warm weather could curb the rise in gas prices, Reuters reported.

According to data from Gas Infrastructure Europe (GIE), gas storage facilities in the European Union were almost 95 percent full on Saturday. In Germany, Europe’s largest gas consumer, storage levels were also nearly 95 percent, while in the Czech Republic they stood at almost 96 percent.

In August last year, wholesale gas prices on the European market climbed close to 350 euros per megawatt-hour due to cuts in Russian supplies. They have since fallen significantly, helped by high supplies of liquefied natural gas (LNG) and a relatively mild winter. Gas prices on the exchange are now well below the administratively set cap in the Czech Republic, which stands at Kč 2500 per MWh.