Energy market in a week: Europe has only to pay — more

If the price of oil still largely depends on the Iranian crisis, then the cost of gas in Europe depends on the reserves in the EU countries. Waiting for the opening of the Strait of Hormuz is delayed indefinitely. But the European Union definitely does not have enough fuel to pass the heating season. After gas, alternative fuel — coal - is also being pulled up.

Oil

Oil dropped below $90 per barrel. From Friday to Friday, the cost of the benchmark North Sea Brent fell from $ 92.4 per barrel to $ 89.3.

Phil Flynn, senior analyst at Price Futures Group, told Reuters that after comments by new Fed Chairman Kevin Warsh about a possible interest rate hike at the end of the year, oil prices continued to decline.

At the same time, the factors of Russia and Iran have not disappeared anywhere.

"The oil products markets look strong against the backdrop of further attacks by Ukraine on Russian refineries," said Phil Flynn. "But there are rumors that we may see an agreement to reopen the Strait of Hormuz over the weekend."

"The market was surprised by the additional flow through the Strait of Hormuz, the agreed Iran-Oman shipping corridor and the US statements on mine clearance," said Rystad analyst Janiv Shah.

Earlier, the United States threatened Iran with complete economic isolation, but it seems that the situation is changing again. Donald Trump's statement about the mega deal with Venezuela — US companies will be able to enter fields with reserves of 65 billion barrels.

Gas

The week before last, the price of gas in Europe exceeded $ 800, and it remained there. During the week, deliveries for a month in advance from the Dutch TTF exchange were somewhat handed over — from $ 815 to $ 806 per thousand cubic meters.

Obviously, this is due to a decrease in the cost of oil and new expectations for the Strait of Hormuz, in which the markets no longer believe so much. You bet.

European companies have nevertheless begun to increase gas imports in order to reverse the situation with low reserves. However, they do it belatedly. The difference from last year remains at the level of 14 billion cubic meters.

Meanwhile, the injection season is nearing completion, while the previous policy of most countries The EU did not provoke prices in the conditions of the Iranian war and did not accelerate the pumping earlier went sideways. Compared to last year, Europe will overpay tens of billions of dollars for imported gas and the Iranian crisis will be only one of the reasons.

Compared to last year, supply quotations have more than doubled.

Unlike oil and gas, coal has risen in price this week, as it becomes a serious alternative fuel at such prices. Deliveries for a month in advance from the Antwerp-Rotterdam-Amsterdam hub (ARA) increased in price over the week from $125.2 per ton to $131.5.