European natural gas price collapse continues, TTF slumps 19%

Quantum Commodity Intelligence – European natural gas prices continued the week's slump Thursday, falling nearly 20% to take the four-day losses to over 60% and largely wiping out the most of the early March gains.

April TTF futures settled at €126.399/MWh, down 19% from Wednesday's close of €159.88/MWh, as Russian volumes continued to flow into Europe.

European gas prices started March at around €100/MWh but surged almost 250% to Monday's peak of €345/MWh, but prompt prices are now down 63% from the record high, which was the oil equivalent of more than $600/b.

Prices have been in freefall since Germany pushed back on US proposals for a US/EU ban on Russian energy, while Russia has not followed through on threats to turn off gas supplies to Europe.  

"The European Commission announced that it plans to reduce Russian gas imports by two-thirds by the end of the year," said Daniel Hynes, senior commodity strategist at ANZ. 

"However, German Chancellor, Olaf Scholz, is opposed to cutting of energy supplies, with the country even allowing Uniper to boost purchases from Russia."

UK NBP futures continued in freefall from Monday's record high of 800 pence per therm (p/th), as April settled at 296.89 p/th, down 20.53% on the day. 

North Asian LNG has also been in retreat since Monday's JKM record assessment $84.762 per/mmBtu, as JKM futures for April dropped below $40/mmBtu.

Meanwhile, Russia offered its first LNG cargo to Asia since the invasion of Ukraine, with Sakhalin Energy offering the cargo for late April loadin.

However, the tender is likely to get a weak response, with traders such as Shell and BP announcing it plans to stop handling Russian energy.