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Netherlands: TTF natural gas Day-ahead extends losses; widening discount to NBP

Heren : 31-Jul-13 20:04

With the exception of the Day-ahead, TTF prompt and curve prices remained range-bound. The Day-ahead sunk close to its lowest level in July as oversupply and low demand weighed heavy on prices.

The effect was a widened TTF Day-ahead discount to the German and British markets. The Dutch product fell to 25.60/MWh on Wednesday, just 0.50/MWh shy from its lowest level on 16 July, according to ICIS data.

A short system in Britain due to North Sea maintenance kept the NBP stronger, widening the Dutch spot discount from 0.398/MWh on Tuesday to 0.647/MWh by Wednesday's close, according to ICIS data.

Sources said this maintenance and the onset of more in Norway from Thursday would be a test to the spread.

If LNG deliveries come into Britain as expected, this should cover demand but if there are additional outages or LNG is taken away, this could bring more upside to the NBP, one trader said.

Traders were unfazed by a temporary glitch to the Dutch grid operator GTS's IT system which meant that the system's balancing tool - the Bid Price Ladder - could not be called until shortly before trading ended at 17:00 local time.

Meanwhile, August '13 remained little changed despite inching closer to delivery. Sources said the bulk of trading had been executed over the previous few days.

Longer-dated contracts remained fairly stable with marginal gains and losses recorded along the curve. One notable exception from the trend was the Year 2016, which made a relatively stronger 0.10/MWh rise session on session compared to its neighbouring annual contracts. Trading remained extremely low and liquidity limited because of the holiday period. Kirsty Ayakwah

By kirsty ayakwah
+44 20 8652 3214

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