‘Close to zero’ chance of gas transit deal – Naftogaz CEO
LONDON (ICIS)–The Dutch TTF January ’20 contract spiked this afternoon after the CEO of Ukrainian state gas company Naftogaz said the probability of agreeing a new transit deal with Russia’s Gazprom before the end of the year was “close to zero”.
The contract had traded within a narrow €0.30/MWh range for most of the session, but gained around €1/MWh within 10 minutes when Andriy Kobolyev made the comments after 15:00 London time, according to ICIS trade data.
“It seems to me that now we can say that the probability of the signing of the transit contract by the 1 January is very close to zero, very small,” he said.
“It’s continuously approximating towards zero with every minute.”
The January ‘20 price peaked at €15.425/MWh at 15:30 but fell into the rest of the afternoon.Transit jitters drive TTF front-month spike
European power markets are also sensitive to news on the transit agreement, as any major changes to gas supply will affect gas for power demand.
The German power January ‘20 Baseload moved up €0.40/MWh between 15:20 and the 16:00 market close and continued to climb. Carbon prices also rose in the afternoon.
The existing contract between Gazprom and Ukraine, currently a key transit route for Russian gas exports to Europe, is set to expire on 31 December.
Trilateral talks with EU officials have so far failed to produce an agreement.
The next round of negotiations will take place in Berlin on 19 December, with a press conference provisionally scheduled for 18:30 German time.
Gazprom did not respond to a request for comment by publication time.
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