Commodity market report
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10 Pages

US-Russia gas supply clash begins: Europe gas and power markets short-term outlook Q4 2016

US-Russia gas supply clash begins: Europe gas and power markets short-term outlook Q4 2016

Report summary

French nuclear outages will remain a substantial factor in French power pricing up to the end of 2016.  But by Q1 2017, the UK will re-emerge as the premium base-load power price. Tightening supply and reduced capacity on the France – England interconnector will push UK prices to multi-year highs through winter.

In the gas markets, a clash between Russian gas and US LNG is set to begin. Europe will need to absorb an additional 24 bcm of LNG in 2017 and utilities will struggle to offtake their Russian gas contractual commitments.  This will result in subdued European spot prices and, with increasing Henry Hub prices, results in some US LNG being uneconomic. For many in the industry there will be some stark choices to be made.

This report includes an outlook for European gas balances and forecast North West European gas and power prices out to Q4 2017.

What's included?

This report includes 2 file(s)

  • US-Russia gas supply clash begins: European gas and power markets short-term outlook Q4 2016 PDF - 372.18 KB 10 Pages, 0 Tables, 11 Figures
  • European gas and power short term price outlook Q4 2016.xls XLS - 475.00 KB


Volatility in oil markets and the growth of unconventional gas supply have created a high degree of uncertainty about future gas demand and the direction of gas prices.

This Gas Markets Short Term Outlook report forecasts future pricing, based on deep analysis of gas supply and demand fundamentals. Additionally, it addresses complex questions on gas flows, identifies future opportunities and informs fuel purchasing strategies.

Participants and investors can use this short term outlook report to understand gas markets and assess the impact of global gas dynamics and key market drivers.

Wood Mackenzie provides detailed supply, demand and price forecasts based on our integrated upstream, power, coal and LNG research. Our regional gas experts are based in the markets they analyse, providing comprehensive analyses of regional and global gas markets.

If you want to understand complex gas market dynamics and plan for the future, Wood Mackenzie is the premier resource to help you gain a clear, competitive advantage.

  • Executive summary
    • Gas highlights
    • Power highlights
  • Supply-demand balances
    • Introduction
      • European gas fundamentals
      • Gas demand
      • Gas supply
  • Prices
    • European gas prices (NBP and TTF)
    • European power prices
      • Progress on nuclear safety cases eases pressure on French prices
      • UK supply margins hit by interconnector capacity loss

In this report there are 11 tables or charts, including:

  • Executive summary
  • Supply-demand balances
    • Key markets data
    • French Nuclear Production
    • Storage inventories*
    • Russian gas imports
  • Prices
    • Gas Prices
    • Economics of US LNG to Europe
    • French reactor outages
    • European base load power prices
    • UK base load prices - year-on-year comparison
    • Clean spreads (base load) - Germany
    • Clean spreads (base load) - France
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