Traders maintained that the market was still skittish about the supply situation going into August.
So far this month, the attitude has been complacent about the upcoming maintenance period, but the mood seems to have turned, and next week could see higher prompt prices, as many might not have priced in a supply shortfall.
Next week, confirmed maintenance is to take place on BP's Unity Riser and the Elgin Franklin complex. The key question on Friday: will there be enough flexible supply to cover this shortfall?
Curve prices are expected to continue to react to outside commodity and equity markets, amid thin trade.
Zeebrugge and PEGs traders generally saw more downside potential for the coming week, notably because of large-scale LNG arrivals at the Zeebrugge and Montoir LNG import facility at the beginning of August. At Montoir, four cargoes are expected on 1, 4, 7 and 11 August. Meanwhile, at Zeebrugge, the Al Jassasiya is scheduled to arrive on 1 August, the Al Shamal on 9 August and the Ejnan on 11 August.
Few thought this week's drivers would feed into next week. "With the end of the month, many people are closing their positions," one source said.
Traders said the outlook for the coming week was neutral to bearish.
Traders saw little change to current bearish fundamentals. Even factors such as forthcoming maintenance on several key pieces of infrastructure would be unlikely to provide too much bullish potential, one trader said. This is already factored in, and would in any case be likely to be offset by the ongoing Transitgas outage, now likely to last until 9 August. As long as the pipeline is out of action, gas originally intended for Italy will stay in the northern European gas market.
Few traders were likely to go into the week with large outstanding positions, due to the change of month and upcoming maintenance. DL/MLDB/RS
Other Related Stories