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3APR13
European gas: Unusually cold weather continues
European hub gas prices climbed above the USD 400/kcm (USD 11.5/mmbtu) mark in late March, the highest since late 2008, before adjusting lower at the start of April on the switch to the May contract. The recent high European gas prices likely reflect...
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27MAR13
Now European forward gas starts to rally
With potentially record breaking cold weather set to continue in Europe and storage levels drained, it is perhaps no wonder that month-ahead gas prices are starting to rise. Day-ahead prices have been strengthening since mid/late February and spiked in March where they have traded above our estimate for the raw oil-linked...
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7DEC12
European spot gas price rising
European hub gas prices, especially those in the UK, have continued to rise quite sharply over the last couple of weeks with NBP now a whisker below the USD 400/kcm (USD 11.3/mmbtu) mark. As a result, the discount to our estimate for the generic oil-linked...
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17OCT12
European spot gas price increasing
Spot gas prices have been rising. The US Henry Hub gas price is only just off its high for the year at USD 121/kcm (USD 3.42/mmbtu), up almost 80% from its late April low. Although somewhat less remarked on, European hub gas prices have also been rising. Since the dip to USD 292kcm (USD 8.27/mmbtu) toward the end of July, European prices have risen more than 20% to around USD 360/kcm (USD 10.2/mmbtu) before winter has even got properly started. Not only...
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5SEP12
European gas prices and the EU
European spot gas prices have risen sharply since late July, increasing 17% to USD 339/kcm (USD 9.6/mmbtu). While that is still some 15% below reported boarder prices for oil-linked gas it is certainly closer than it has been for much of the summer. ...
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22MAY12
Japanese LNG demand tightening European gas supply
Although European spot gas prices have fallen 14% since the beginning of May to USD 297/kcm (USD 8.42/mmbtu) it is worth remembering that LNG markets are tightening quite sharply, so far as Europe is concerned. Japan’s last operating reactor was shut on 5 May...
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25APR12
Shale gas is not about to transform the European gas market
The collapse of US gas prices to less than USD 2/mmbtu (USD 71/kcm) and recent newspaper articles touting shale gas production in Europe and large scale export of US gas has increased concern that the pricing and sales volume of Russian gas to Europe are under renewed threat. They are not, in our view. European markets are currently challenging as a result of a lack of demand, not...
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11APR13
Trade surplus started declining in February
... facilitated the narrower surplus. Exports of the major items contracted both YoY and MoM (being seasonally adjusted). This can partly be explained by the YoY decline in oil prices (Urals was down 3.6% YoY in February) as well as the warmer weather in Europe (which was a significant drag on gas exports, which were down a quarter). The February data on the external balance is likely to mark the beginning of a gradual moderation in Russia’s trade surplus, as we do not see any possibility for it to exceed...
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8APR13
Key events are non-CIS imports and car sales for March
... 1.0tn (from RUB 1.1tn in February), bringing the monthly federal budget balance into the black. External trade balance for February. The YoY contraction in exports (owing to a YoY drop in Urals prices and weak gas exports due to the warm weather in Europe) in combination with rather strong growth in imports (2% YoY, according to the preliminary customs reading) might result in a lower trade balance surplus and a greater decline in annual terms. Rosstat’s consumer confidence index for 1Q13. The business...
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4APR13
Energy prices update
... new policy, we incorporate actuals for March and a minor re-profiling of our forecast to allow for a 1Q13 PE price outcome some USD 3/bbl above our forecast and are increasing our FY13 Brent forecast USD 1/bbl to USD 106/bbl. We are also revising our European gas price forecasts to reflect the updated Brent forecast and amending our WTI forecast for the actual 1Q13 outcome, together with the change in shape of the Brent-WTI futures spread. The supply/demand data continues to suggest that the market...
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22MAR13
Government discusses Strategy for Developing the Russian Far East and Baikal region
... Expanding capacity on the Baikal-Amur Mainline and the Trans-Siberian Railway would facilitate tighter economic integration, both within the region and between it and central Russia. It would also enhance Russia’s role as a transport link between Asia and Europe. However, Russia probably cannot afford RUB 10tn. First Deputy Prime Minister Igor Shuvalov suggested treating the document as a long list of desired projects, and then refining it by the end-2013 to differentiate between the mandatory and optional...
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12MAR13
NBP trades at USD 477/kcm
....5/mmbtu), notwithstanding Total’s announcement that its Elgin/Franklin field complex has resumed after being shut in for a year. That took the gas price above the oil linked price for the first time this year. Day ahead prices have been rising across Europe since mid-February with the pace increasing sharply since the beginning of March, particularly in the UK. The increase is reflective of another sharp bout of winter weather in Europe coming against the background of sharply depleted storage levels...
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25FEB13
Russian gas: FTS might consider 3% change in gas tariff in 2Q13
... growth is to be equal to the planned 15%. The scheme would work as follow: gas tariffs in Russia for industrial users would be adjustable by 3% (either upward or downward) on a quarterly basis, depending on oil product (fuel oil and diesel) prices in Europe with a nine-month lag. The first 3% change might come into force as early as 2Q13. However in 4Q13, a gas tariff adjustment opposite to that of 2Q is to be made in order to fully offset the effect of the 2Q change and keep average gas tariff growth...
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8FEB13
LNG spot prices continue to increase
... been bidding aggressively for LNG cargoes as drought has reduced hydroelectric capacity forcing a turn toward gas fired generation for which imported LNG is needed while Argentina has also reportedly been bidding aggressively for cargoes. Rising ex-European prices for spot cargoes have begun to pull up European spot LNG prices which have jumped almost 30% since the start of the year to USD 14.70/mmbtu (USD 519/mcm) and are now comfortably ahead of our estimate for the generic European oil-linked...
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31JAN13
Andrey Kostin on Basel III: stricter regulation can create “new risks”
« In Russia, we need to explore and draw on the experience of Europe. To avoid global risks in the globalised economy, we need globally-agreed rules that are followed globally. If this does not happen, the risks of imbalances we have yet to experience are hazardously high. Allowing countries like Russia to benefit...
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14DEC12
Weather turns cold, ‘spot’ LNG price increasing
Since the beginning of November, which broadly marks the real start of the heating season in the northern hemisphere, the weather has been generally colder than average in Europe and Asia, based on data for selected cities. For Europe and Moscow, the difference has been fairly marginal but for Asia, the winter has been around 24% colder than normal so far this year when measured in terms of the number of Heating Degree...
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11DEC12
Preliminary data has Chinese oil demand at an all-time high
... their August low. Managed Money net positions were up in the week to 4 December. In the US, the CFTC reported US Managed Money net longs in futures and options (F&O) in WTI sharply up 13,434 positions (+11.6%) WoW to close at 129,530 positions. In Europe, the ICE reported Managed Money net longs in F&O in Brent up 3,477 positions (+3.2%) to 111,589 positions, a seven week high. Brent was flat WoW at USD 109.84/bbl while WTI closed 1.5% up WoW USD 88.50/bbl. OPEC and the EIA publish their monthly...
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23NOV12
Marking oil to market for 2012
... methodology of setting our WTI forecast in line with our Brent forecast, adjusted for the difference in forward curves. That results in a USD 3/bbl reduction in our WTI forecast to USD 88/bbl for FY12 and minor reductions prospectively. Our oil-linked European gas price forecast is adjusted to reflect our revised oil price forecast and we continue to expect European hub gas prices to trade at a 10% discount to the oil-linked price from 2013. For FY12, although we would not be surprised to see European...
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8NOV12
Rouble REER gained in October
The rouble real effective exchange rate appreciated 0.8% MoM in October, strengthening from a decline of 0.4% MoM in September and bringing the YTD change to +3.9% (from +3.1% in January-September). The rouble strengthened 1.4% MoM against USD (+3.9% YTD) and 0.6% MoM against EUR (+6.3% YTD) in real terms. RUB REER appreciation in October was a combination of the nominal rouble strengthening during the month (1.4% MoM against USD and 0.3% MoM against EUR, according to official average rates) and...
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7NOV12
EIA cuts 2013 supply surplus by cutting OPEC production forecast
The EIA published its Short-Term Energy Outlook (STEO) yesterday, maintaining a supply surplus for 2012 at 0.05mmb/d, fractionally down from 0.09mmb/d in the prior month. Global demand in 2012 was revised marginally lower to 89.05mmb/d, down 0.04 mmb/d MoM, whilst non-OPEC production was cut 0.12mmb/d MoM. A lift in the EIA’s projected 2012 OPEC production helped keep supply in surplus. The more significant adjustments came in the 2013 forecasts, where last month’s 0.6mmb/d supply surplus was cut...
