Gas trading slowdown may hit TTF

By Peter Stewart 10 May 2017
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Wildervank station, Groningen gas field, Netherlands. (Skitterphoto) Wildervank station, Groningen gas field, Netherlands. (Skitterphoto)

Gas trading volumes in Europe declined by around 4% year on year in Q1 2017. This was despite a strong upturn in gas demand in 2016 caused by increased power sector and weather-related demand. Nevertheless, the Dutch TTF hub has so far been resilient relative to other main competing trading centres. However, a cap on gas production at the Groningen gas field in the Netherlands and a switch away from gas in the power sector may change this picture.

Over-the-counter (OTC) gas trading on the TTF overtook OTC volumes at the UK’s NBP for the first time in 2016, and the UK’s plans to leave the EU are expected to see that trend continue. OTC gas trading liquidity at the TTF in the first three months of this year dropped by only 0.5% compared with the same period in 2016, while OTC volumes at the NBP dropped by 19.6%, according to data supplied by the London Energy Brokers Association (LEBA). 

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