Big Bounce: Russian gas amid market tightness - new report by Oxford Institute for Energy Studies

[Tomasz + 1,608]

Introduction:

 

Quote

The big bounce in Russian gas production in 2021 has proven to be insufficient to meet the simultaneous spikes in demand at home and abroad. Russian gas output has risen robustly and has been close to its maximum productive capacities but the necessity to fill the depleted domestic gas storage facilities in Q3 2021 limited the availability of Russian gas for Europe when it was most needed. Indeed, Russian exports to Europe this year have reached the record levels last seen in 2018-19, focusing mostly on Turkey and Germany – the two markets that are connected to the Russian gas system by direct undersea pipelines. Moreover, with other supply sources to Europe falling, and given the changing geography of Russian reserves, it appears that Russia cannot single-handedly balance sudden spikes in European gas demand. Russia is not running out of gas and its prolific gas reserves all.

 

Full reportL

 

https://www.oxfordenergy.org/publications/big-bounce-russian-gas-amid-market-tightness/

 

Current gas situation:

I find it some what ironic that the EU and the US state that “the Russians may be trying to squeeze the continent even after never ending story that Europa really doesnt need russian gas anymore.

There was talk for years that Russia sends way too much gas to Europe. Now its said it sells way too little despite selling something like only 2 % less than in record breaking 2018.

Isn’t this strategy made in the “capitalist” way? Didn’t the electrical companies “squeeze” Texans during last winters ice storm? Spot market pricing for electricity?

The “Russians” have “learned” the Western ways. Let's hope Russians learned also not to oversqueeze.

Better hurry up and certify Nordstream 2 then.

And if someone wants even more gas in the future more long-term contracts must be concluded that guarantee costly and long-term investments. This, in my opinion, is what this report says.

 

Edited September 23, 2021 by Tomasz

[nsdp + 449]

The report looks about as sane as one from the Manhattan Institute. It also ignores George Mitchell the founding father of "fracking". There is no cure as certain for high prices as high price . Seems to work on about a 5 year cycle. Should collapse again in 2023-4

[Tomasz + 1,608]

So lets see how exacly it looks like in 2021 vs 2020

 

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And if someone does not like the current TTF NG prices, it is due completely to  simple facts:

- sanctions on the Russian oil and gas industry

- sanctions ald low NG and oil prices after 2014 have significantly brought down the CAPEX of Russian companies especially Gazprom

- so  no one has now the right to reject the fact that they have priority to supply  Russian market rather than Europe

- the admission of speculators and traders to the gas market - I suggest to read what happened after US law that lead to admission of trader and hedge funds in 1999- dont you remember oil prices in 2004-2008 time?

- basing the gas market on the actual spot price connected with LNG prices

 

So significant fall in CAPEX, speculators and gas shortage on the market  both at the same time and disaster is done.

Somehow, no one had any complaints when last year NG at TTF  cost as low as $ 2 per mbbtu in the spot in spring time

So $ 2 then now $ 20 average price is about $ 11 - good price for everyone.

 

Today Trafigura cofirms that

Trafigura

http:// https://twitter.com/JavierBlas/status/1442459086390497287?s=20

https://twitter.com/JavierBlas/status/1442459086390497287?s=20

Edited September 27, 2021 by Tomasz

[Starschy + 211]

Oxford Institute for Energy Studies

Put all those Oxford Studies to the Trash. They don't have a clue about Russian Energy nor even their Homecountry.

[Tomasz + 1,608]

On 10/4/2021 at 8:23 PM, Starschy said:

Oxford Institute for Energy Studies

Put all those Oxford Studies to the Trash. They don't have a clue about Russian Energy nor even their Homecountry.

Well so you should meet for example Katya Yafimava on twitter- definitely russian expert in Oxford and strong SUPPORTER of NS I NS II and Power of Syberia II -simple lets say russian gas and LNG for global community. Meet her of twitter - one of best twitter acount abou NG and LNG

https://twitter.com/katyafimava

If you dont like her study please get information about new numbers in November 2021

So #Russia's Gazprom pumped an average of 1.5bcm of #gas a day in November, the highest for the month in a decade and close to peak output, show calculations based on company’s preliminary operating data. #Russia Nov oil & gas results out gas output was up 5% y/y to 66.1bcm in Nov Gazprom producing 1.5bcm/d – close to max cap says VTBC. So little room to increase exports even if wanted to. 

But Gazprom export to Europe is down 24 % in Novermber - lowest numner in November since 2014

So Europe now can say that "Houston we have a problem?"

 

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In the years 2022-2024, gas prices in the world markets may start to gradually decline from their previous records, but it is possible that they will remain higher than on dock prices, said the vice president of the management board of Gazprom Famil Sadigov.
"We currently have a consensus on the forecasts of many analysts: in 2022-2024, gas prices in the world markets will gradually decline from their current record levels, but remain significantly higher compared to the dock levels," he said in an interview. to the corporate publishing house "Gazprom".
According to him, the financial results of the Gazprom group should be kept "at an appropriate, very high level", even with very moderate, by today's standards, gas export prices.
The tangible increase in gas prices in Europe started in April-May, when the average TTF spot price fluctuated around USD 250-300 per thousand cubic meters. In recent days "Due to the balanced structure of our export contract portfolio, the average delivery price in 2022 will be higher than the 2021 average, even if spot prices drop significantly from current levels," added Sadigov.
In August, Gazprom announced that it forecasts the average price of the company's long-term gas contract portfolio to non-CIS European countries in 2021 at USD 269.6 per thousand cubic meters. However, in October, Bloomberg, citing a Wood & Co analyst's review after a meeting with the company's management, reported that Gazprom revised its index forecast, raising it to $ 295-330 per thousand cubic meters.
In 2020, the average price of Gazprom's gas exports was USD 143 per thousand cubic meters, which is 32% less than in 2019

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2021 Gazprom NG production currently forecasted at  515 bilion (more than 62 from 2020)- highest annual production in 13 years.

Currently we have big cold in Russia- last night in Moscow minus 22 C . Cold snap coming from Syberia to Europe.