MOSCOW, August 9 - PRIME. The risk of reduced gas supplies through the "Sudzha" gas measurement station (GMS) has led to an increase in gas prices. The September futures for natural gas at the TTF hub rose by 4% on August 8, 2024, reaching $423 per thousand cubic meters. It is likely that the price increase will also be observed on August 9, but the average monthly prices will not exceed $500 per thousand cubic meters. This forecast was made for Prime by Sergey Tereshkin, CEO of the oil products marketplace OPEN OIL MARKET.

First of all, the relatively low share of supplies through the GMS "Sudzha" in the overall gas import structure to the EU will have an impact. According to the European Network of Transmission System Operators for Gas (ENTSOG), total gas imports to the European Union, including transit supplies via Serbia and North Macedonia, reached 800 million cubic meters per day (m³/day) in July 2024, of which just over 5% (43 thousand m³/day) came through the GMS "Sudzha."

Secondly, the targeted gas savings by EU countries, which have been in place since August 2022 when agreements to reduce gas consumption by 15% compared to the average multi-year level took effect, will play a role. The effect of savings was noticeable this year as well.

According to Ember, electricity demand in the EU increased by 9 terawatt-hours (TWh) in the first half of 2023, but at the same time, generation at gas-fired power plants decreased by 29 TWh during the same period. The lost volume was fully compensated by an increase in generation from wind, solar, nuclear, and hydropower plants.

Finally, gas savings in energy-intensive industrial sectors will also have an effect. One sign of this savings is the PMI Manufacturing index for the eurozone, which has remained below the 50-point mark (the boundary of recession in manufacturing industries) since July 2022. In July 2024, the PMI Manufacturing index for the eurozone stood at 45.8 points. Not surprisingly, total gas imports to the EU in July 2024 were 16% lower than in July 2022 (800 million vs. 954 million m³/day, according to ENTSOG data).

Therefore, the impact of a potential reduction in gas transit through the GMS "Sudzha" will be limited. The main losses will be borne by Hungary and Slovakia, which have limited options for diversifying supplies. Average monthly gas prices in Europe in August 2024 will not exceed $500 per thousand cubic meters, after which a correction will begin, even despite the approaching cold season.

Translated using ChatGpt

Sourse:  https://1prime.ru/20240809/gaz-850771803.html