Energy market in a week: The change of Gazprom to American LNG has its price

Oil is anchored at $ 60 — the lowest since 2021. Meanwhile, gas in Europe in the new conditions has a cost reduction limit and it is not in favor of the local industry. The European Union has to pay for changing Russian gas to American LNG.

Oil

For the first time since 2021, the price of oil fell below $ 60 per barrel during the week. During the week, the cost of the benchmark North Sea Brent changed from $ 61.1 to $ 60.3.

"The oil complex is showing a slight increase, holding above the lows set this week, in anticipation of further developments on the peace talks between Ukraine and Russia, as well as news from Venezuela about the potential impact of the blockade of tankers by Trump," said analysts at consulting Ritterbusch and Associates.

Donald Trump himself said in an interview with NBC News that he leaves such an opportunity.

Uncertainty about how the United States will block tankers under sanctions has reduced geopolitical risks so far, IG analyst Tony Sycamore told Reuters.

So far, Venezuela, which produces about 1% of the world's oil, has allowed two vessels not under sanctions to go to China.

In the financial market, meanwhile, the situation for oil began to develop not in the most favorable way. The central banks of developed countries are signaling a possible change in their position on interest rates to curb inflation.

For example, the Bank of Japan has raised interest rates to levels not seen in the last 30 years. And representatives of the European Central Bank warned of excessive risks associated with their latest economic forecasts, urging caution in policy-making.

Gas

Gas in Europe continues to win back a three-week decline in price, but it remained at the lowest level since February 2024. Monthly deliveries from the TTF exchange increased in price from $ 338 per thousand cubic meters to $346.

So far, nothing threatens gas supplies to Europe. Stocks in storage facilities are lower, but the selection from UGS is low. At the same time, LNG supplies from the USA and gas from Norway is at a consistently high level. As well as Gazprom, which in December sets a new record for the European line of the Turkish Stream.

On the other hand, the availability of sufficient volumes of gas does not yet solve the main problem of the region — the restoration of industry. According to Bloomberg, seasonal price reductions are not a reason for companies to return to Europe or reopen factories.

At the same time, the price of gas in Europe can be considered low compared to the jumps during the energy crisis, and not before it. Thus, the average cost of fuel on German stock exchanges in the five-year period before the energy crisis was $ 180. And the current quotes still have a lot to strive for. Although the price reduction is limited by the high cost of LNG compared, for example, with Russian gas.

Coal prices in Europe have changed slightly this week. Deliveries for a month in advance from the Antwerp-Rotterdam-Amsterdam hub (ARA) fell from $97.3 per ton to $96.9.