Europe gas and power markets short-term outlook Q4 2019
European gas prices have been on a downward trajectory since October 2018 – with TTF hitting an all-time monthly low of US$3.1/mmbtu in September 2019. Assuming no disruption to Ukraine transit, the prospects for price upside over the next two years are extremely limited. Europe held a record 101 bcm of gas in storage at the end of October, more than 98% full. Market uncertainty on Ukraine transit from 1 January 2020 remained the main driver in supporting injections. LNG flows available to Europe will be accommodated in 2020 and 2021 but prices – and piped suppliers – will suffer. Further LNG import growth will push prices down as low as $3.3/mmbtu in summer 2020.