German markets: BEB hub firms on cold weather and TTF
BEB: Activity on the German BEB has remained constant over the past two weeks. Although its rival, E.ON Ruhrgas’ market, has been reportedly inactive (see separate story on page 4), the lack of capacity between the two has seemingly prevented any real surge of growth at the BEB.
The prompt followed the TTF’s bull run in the third week of October, as Norwegian players appeared unable to divert gas flows from the UK to the Netherlands, on speculation that they had “maxed out their capacity to the Continent”.
However, on the back of the TTF, the BEB prompt emerged volatile. Despite a rebound in prices on 23rd October following earlier losses, the underlying bearishness in the continental markets resurfaced and continued throughout the period.
Mild weather and a lack of storage opportunities continued to rein in demand, while Continental supply was good.
However, cold weather forecasts and a bullish NBP have underpinned the market in the second half of October, as Day-ahead dealt up to EUR 19.30/MWh.
Day-ahead basis remained stable for most of the latter half of October, although traders have reported a widening basis premium at the German hub over the past few days. Spread deals were reported at the end of last week for +0.30/MWh and +0.35/MWh, while one spread deal was heard trading on at +0.80/MWh.
There was very limited interest in the near curve with November dealing in thin talk at a slight premium to the TTF.
Ruhrgas’ choice market and OTC trading: Activity on both markets reportedly dried up during the latter half of this month (see Focus on page 4).
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