European gas price with limited downside – Commerzbank

The European gas price (TTF) has fallen back to around EUR40 per MWh over the past week, Commerzbank's commodity analyst Thu Lan Nguyen notes. 

Scope for further natural gas price weakness is limited

"In addition to general economic concerns, a better supply situation is also providing relief. According to Bloomberg data, LNG imports in March reached their highest level for the month since 2017, which should somewhat alleviate fears regarding the current lower filling levels." 

"According to the GIE, European gas storage facilities were 34% full on 30 March, compared to a 5-year average of 45% at this time. The relatively high gas price compared to last year — it is currently around twice as high as last year — is likely to have helped increase imports." 

"This in turn means that a permanently high price is necessary to ensure that producers continue to sell large quantities of LNG to Europe. We therefore believe that the scope for further price weakness is limited."