Goldman Sachs: Gas prices are likely in Europe drop by 30%

Goldman Sachs predicts natural gas prices in Europe will decline by around 30% in the coming months, due to the measures taken by European countries to secure supply.

The Dutch Conversion Plant (TTF) is the main reference point for natural gas prices in Europe, where gas is trading at around € 120 per megawatt hour, but Goldman Sachs expects the price to drop to € 85 per megawatt hour in the quarter. The first of 2023, according to a research note published last week.

This would represent a significant change from the high levels seen last August when in at that moment the Russian invasion of Ukraine and subsequent pressures on the European energy mix pushed prices to historic values, says a report published by the American network “CNBC”. 340 euros per megawatt hour).

And CNBC cites the US report, stating that the recent drop in gas prices is caused by several factors: gas stocks in Europe are basically full for this winter season; Temperatures this fall were milder than expected, delaying the start of the period of heavy use; Furthermore, there is an increase in the supply of liquefied natural gas.

Recent reports have indicated that around 60 ships are in waiting to unload their LNG cargo in Europe, some of which were bought over the summer and are now coming with full stock.

The latest data, compiled by Gas Infrastructure Europe, show that storage levels in Europe are 94%.

Despite optimism about falling gas prices in the short term, which could alleviate some of the cost of living crisis, there is strong pressure on European leaders to secure supplies in the medium term.

“Our team of the subjects prime expects to drop further to € 85 in the first quarter before drastically increasing next summer when storage levels will rebuild, “Goldman Sachs analysts said in the research note. Their prediction is that prices will rise to just under. of 250 euros per megawatt hour by the end of next July.

Fatih Birol, executive director of the International Energy Agency, said last week that a very small amount of new LNG will hit the market next year. “If the Chinese economy sees a recovery, Chinese imports of liquefied natural gas could also increase next year along with Europe,” he said.

China was the world’s largest importer of liquefied natural gas in 2021, according to the US Energy Information Administration. However, due to its strict policy regarding the Corona epidemic, the Chinese economy has had to contend with a series of closures that have held back growth.

Read More About: Business News

Follow AsumeTech on

More From Category

More Stories Today

Leave a Reply