The lead European natural gas contract surged on Thursday, on concerns an explosion at a key U.S. liquified natural gas plant may reduce exports to the Continent.
Dutch TTF gas futures jumped 16% in early action to €91.90 per megawatt hour, following the explosion at the Freeport LNG facility in Texas.
Reuters reported the plant, which provides about a fifth of U.S. LNG processing, will shut for at least three weeks.
Analysts at Goldman Sachs left their U.S.
NG00,
and European natural gas contract forecasts unchanged.
“From an export perspective, the near-term impact from the 15 mtpa Freeport outage would be moderated in the first week by the use of LNG already in storage tanks to load ships, though a reduced liquefaction rate beyond that would start to be felt. That said, we estimate it would take an outage lasting more than 70 days before its estimated 20 mcm/d impact on NW European storage took end-summer inventory levels below 90% of full vs our current 93% of full expectations,” said analysts led by Samatha Dart.
This post was originally published on Market Watch
