LNG Market Outlook
The past month has not seen European natural gas storage recover to more normal levels with total storage levels remaining below the five-year range and well below last year’s level. Granted, storage levels for 2019 and 2020 were extremely high, but the market cleared almost all of that excess inventory in one winter, so if the weather is cold this winter, the European market may be headed for trouble. Prices are extremely high for this time of year and even higher than they have been the past two winters. The forward curve indicates the mood for the coming months is similar with little price or perhaps volume relief coming. It is getting late in the season for storage levels to pop up too much, especially given the low volume of LNG and pipeline gas currently headed into the region.
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