Prices at Europe’s Title Transfer Facility (TTF) have continued to decline, falling from $7.8 per million British thermal units (MMBtu) last week to $7.48 per MMBtu at the time of writing on 20 February.

Bearish fundamentals persist despite mild disruptions in Norwegian gas pipeline flows, as European storage levels remain high compared to previous years amid relatively warm weather across the continent.

In Asia, the Lunar New Year holiday has kept activity subdued, although there has been some renewed activity in the spot market as festivities come to a close.

Asia spot LNG prices dipped slightly from $8.8 per MMBtu last week to $8.57 per MMBtu currently, again on bearish fundamentals as a relatively warm winter has kept liquefied natural gas (LNG) inventories high.

In the US market, Henry Hub has dipped just slightly from $1.6 per MMBtu last week to $1.56 per MMBtu now, maintaining lower prices on the back of burgeoning domestic natural gas production, above-average storage levels and a warmer-than-normal weather forecast through to the end of February.


Gas and LNG flows into Europe remain steady as warmer-than-normal winter weather keeps demand low. Norwegian pipeline gas flows to Europe were 338.49 million cubic meters per day (MMcmd) as of 18 February, slightly less than the 350 MMcmd seen earlier in the winter.

This is due to an unplanned outage at the Karsto processing plant, which has impacted 12.5 MMcmd of capacity, with ongoing planned maintenance set to impact an additional 12.1 MMcmd through to 29 April.

A dip to 317.80 MMcmd on February 15 and 16 did little to reverse bearish fundamentals in Europe’s well-supplied market.

Russian gas supplies to Europe have been stable, at 88.28 MMcmd on 17 February, compared to 89.66 MMcmd on 10 February.

European storage levels were 75.23 Bcm or 65.5% full as of 17 February, compared to 77.05 Bcm or 67.1% full on 10 February.

This is 6.7% higher than the 70.50 Bcm reported on the same date a year ago.

Despite colder weather earlier in January, which reduced storage levels to those seen in January 2023, warmer-than-normal weather has since prevailed in Europe and is anticipated to continue until early March.

This has allowed underground gas storage to build up again compared to previous years and is likely to reduce demand for restocking during the injection season.

As Europe approaches winter's end with higher-than-normal gas in storage, the TTF forward curve continues to reflect a relatively subdued market, with prices in the high $7 per MMBtu range until September 2024.

LNG imports to Europe totaled 3.01 million tonnes (Mt) for week 7 ending 18 January, which is mostly in line with import trends for late January and early February.

Cargoes from Qatar to Europe have been diverted around the Cape of Good Hope instead of the Suez Canal due to instability in the Red Sea beginning in late December/early January.

These cargoes have started to arrive in Europe, taking an average of 30.2 days around the Cape of Good Hope, compared to 17.9 days via the Suez Canal.

LNG trade flows from Qatar to Europe will continue, except now with a longer voyage time.

The additional voyage duration has not impacted TTF prices, with LNG imports still in line with trends from previous months.

The situation will unlikely affect future prices if major hubs remain well-stocked worldwide.

There are currently no LNG vessels transiting the Suez Canal.


There has been some resumption of LNG spot trading activity as the Lunar New Year holiday comes to an end.

Mainland Chinese, Indian and Thai players have shown some interest in the market, with observers looking for renewed spot market activity to set the tone for import levels and prices for April 2024 deliveries.

On average, winter has been warmer than usual in Asia, which has kept gas inventories higher than normal through most of the season.

This has been the general trend, barring a few periods of cold weather.

A recent spate of chilly temperatures left LNG inventories reported by main power utilities in Japan at 2.06 million tonnes on 11 February, some 16% less than a year ago and 3% less than the five-year average for the end of February.

The Japan Meteorological Agency (JMA) has forecast at least a 50% probability of above-normal temperatures across most parts of Japan until mid-March.

Therefore, although storage levels are slightly lower than average, the warm weather anticipated for the coming month will likely keep demand for additional cargo purchases low.

The Korea Meteorological Administration (KMA) has forecast below-normal temperatures for South Korea until early March before slowly transitioning to normal temperatures from early to mid-March.

South Korea is estimated to have healthy LNG inventories and is unlikely to require additional purchases as temperatures warm up, approaching the end of winter.

In Indonesia, Tangguh LNG Train 3 has been offline since 14 February due to a technical issue. As highlighted in last week’s note, export volumes from the new train are relatively small and are unlikely to impact the market.


Despite a cold freeze disrupting some production earlier in January, natural gas production has returned to high levels, with dry production at an average of 104.7 billion cubic feet per day (Bcfd) as of the week ending 14 February.

As mentioned in last week’s note, although Henry Hub prices are currently deflated, it typically takes months before supply chains and rigs can be re-mobilized to produce at different levels.

Producers will likely stick to existing production levels to take advantage of higher prices over winter, even through recent periods of lower prices.

US gas demand remains tepid as the weather has returned to being warmer than usual.

The reported deviation from normal for heating degree days (HDD) across the US was -45 as of the week ending 8 February.

This implies that there has been a lower demand for heating compared to the average for the same period.

Weather forecasts indicate that HDDs will stay lower than expected until the end of February, indicating that warmer-than-usual weather will keep a lid on heating demand.

As a result of solid production and generally weaker demand, US gas storage levels are still high at 2,535 billion cubic feet (Bcf) as of 9 February 2024, compared to 2,266 Bcf on 10 February 2023.

Freeport LNG remains offline due to technical issues on one of its three trains.

Feedgas to the site was at 1.55 Bcfd on 16 February, compared to 2.1 Bcfd throughout most of December 2023 and January 2024.

With unutilized capacity reducing demand for feedgas, Henry Hub prices may be more supported when Freeport LNG resumes service later in February.