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Northwest European gas market review – March 2021

We are pleased to present our latest Northwest European gas market review.

Highlights of our March 2021 report include:

  • Gas prices: The average gas price in Northwest Europe fell by 15% month-on-month in February, to 17.5€ /MWh, due to lower gas demand. Concurrently, weak Asian LNG demand led to LNG cargoes being diverted to Europe, which helped to ease the supply tightness in the European gas markets. Despite a decline in gas demand, the gas price remained at the similar level in March, supported by the incident at the Suez canal at the end of March
  • Consumption: Total gas consumption in NW Europe dropped by 5 bcm in February, to 30 bcm, and further fell to 28 bcm in March as mild weather reduced heating demand
  • Supply: LNG imports increased by 1.7bcm month-on-month in March, as LNG deliveries to Europe recovered due to decreased Asian demand. This led to the share of LNG in the total gas balance increasing from 9% to 15%. Nonetheless, LNG imports are 1.0 bcm lower year-on-year with robust pipeline flows. Russia pipeline imports rose by 5 bcm year-on-year, gaining 5%-points in EU market share. In contrast to the Russian pipeline, Norwegian imports fell by 1 bcm, losing 1%-point over the same time period
  • Indigenous production: Dutch production was 5% and 2% higher year-on-year and month-on-month respectively at the expense of storage withdrawals. GB production fell by 9% month-on-month, but increased by 26% year-on-year to compensate for decreased LNG imports and replenish the storages
  • Pipeline imports: Total pipeline imports rose by 8% versus the prior year, primarily due to 1.6 bcm higher flows from Russia. Driven by high prices, Russia increased gas exports to Europe via all the major routes
  • LNG: Total LNG send-out from NW European LNG regasification terminals was 18% lower year-on-year, led by GB. By contrast, France saw an increase in LNG imports to help balance the French gas market, causing the regasification terminal utilisation rate to rise to over 80%
  • Storage: Following the January withdrawals, inventory levels in February remained below the 5-year average. Additional withdrawals in March caused the inventories in the Netherlands and Germany to fall to 40 days and 20 days of demand, around 40 days less than the inventories a year ago

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