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Europe now has so much natural gas that prices just dipped below zero

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Re: Europe now has so much natural gas that prices just dipped below zero

#51

Post by lowercased »

msie wrote: post #43
anm89 wrote: post #36

Different countries have very different storage capacities. Some nations have most of their years demand in storage capacity whereas others like the UK have only a few days and require a constant flow. If you are one of the countries that can store a whole year this is great news. If you're Britain, you could still be out of gas and paying exorbitant prices a week from now

Heh, how's Brexit working out for them? BTW has Nigel Farage paid for his lies?

Not to dismiss this entirely, but I can't recall political leaders at that level ever 'paying' for lies or misinformation in any capacity commensurate with the negative impact of the lies. Has his reputation been dinged a bit in some quarters? Perhaps. That'll be the extent of it.

Re: Europe now has so much natural gas that prices just dipped below zero

#52

Post by xapata »

arbuge wrote: post #50
dr_faustus wrote: post #31

I really don't understand the doom and gloom wrt next year. What was obviously completely underestimated was the elasticity of consumer demand for gas. In Germany, consumers are using 25% less gas even if you account for the weather. So with increased supply from Netherlands and Norway, even a limited amount of LNG will probably be enough to fill the storage again and compensate the missing Russian gas (which account…

> We, too, have not switched on the gas based heating yet. Instead, we are using a mix of wood and infrared electrical heaters In the event that your electric power is derived from gas, you've shifted the burden elsewhere and actually increased overall gas consumption, since using gas to warm your home directly would be more efficient.

Not if the electric heaters aren't producing the same amount of heat. The comment suggested they've reduced heat consumption.

Re: Europe now has so much natural gas that prices just dipped below zero

#53

Post by kryptiskt »

Silverback_VII wrote: post #21
mensetmanusman wrote: post #7

This is a better situation than the reverse. It’s fortunate the winter has been mild so far. Will be interesting if the LNG industry can keep pace and replace Russia for good.

>LNG industry can keep pace and replace Russia for good. Nobody can replace Russia and their resources in the long-term.

Nobody should replace Russia in the long term as fossil fuels should go away completely.

Re: Europe now has so much natural gas that prices just dipped below zero

#54

Post by tuukkah »

It's the same with electricity markets: at times there's so much wind and nuclear power that the spot price goes below zero in Europe as well as in the US: https://www.sciencedirect.com/science/article/pii/S266679242...

I still pay around 5 cents/kWh to the middlemen though so consumption hasn't been profitable to me so far.

Re: Europe now has so much natural gas that prices just dipped below zero

#55

Post by asdajksah2123 »

dr_faustus wrote: post #31

I really don't understand the doom and gloom wrt next year. What was obviously completely underestimated was the elasticity of consumer demand for gas. In Germany, consumers are using 25% less gas even if you account for the weather. So with increased supply from Netherlands and Norway, even a limited amount of LNG will probably be enough to fill the storage again and compensate the missing Russian gas (which account…

> What was obviously completely underestimated was the elasticity of consumer demand for gas

I don't think it was evident that individuals and businesses would be willing to make some of these changes they have. For example, German companies are planning on shutting down factories for the winter. Cities are planning on ending night lighting.

In addition, winter so far has been fairly warm. It may still turn cold, so Europe isn't out of the woods yet.

Finally, the increase in the LNG supply was achieved incredibly fast. If someone had predicted Europe would have the LNG supply they do today at the beginning of the war they would have been dismissed as a utopist.

Re: Europe now has so much natural gas that prices just dipped below zero

#56

Post by Denvercoder9 »

atty wrote: post #16

I am an American and not knowledgeable about how energy pricing works, so I am curious, how do we square this with the rates that Europeans have been paying for energy and natural gas lately? Are utilities making off like bandits? Or were they running very low over the last few months and suddenly got a huge influx?

> how do we square this with the rates that Europeans have been paying for energy and natural gas lately?

Different markets. The price that went negative was for immediate delivery of gas (spot market), while utilities buy their energy way before it's actually delivered (futures market). The price on the spot market went briefly negative because it's unseasonably warm in Europe right now (so less gas usage for heating), and all the storage is nearly full. The price on the futures market is still high, because once it gets cold demand will pick way up and outpace supply.

An interesting sidenote is that storage being full significantly increases volatility in the market: in the usual situation, a storage facility would buy up all the surplus gas on the spot market at a cheap but probably non-negative price, store it, and sell it on the futures market for a higher price. This stabilizes the market, and creates some constraints on market prices. Now that storage is full, they can't do that, and prices can fluctuate much more.

Re: Europe now has so much natural gas that prices just dipped below zero

#58

Post by sorokod »

jefftk wrote: post #5

Normally you run storage facilities neither all the way full nor all the way empty: you want to be able to smooth out fluctuations in supply and demand. Because of the war Europe is running gas storage near its upper limit, which means we should expect less flexibility and more price volatility: they won't want to draw them way down if we get a serious cold snap, and they have nowhere to put extra gas if it's warmer…

>you want to be able to smooth out fluctuations in supply and demand.

Can you say a bit more about the "you" mentioned?

I can imagine "you"s who care only about having heating during wintertime.

Re: Europe now has so much natural gas that prices just dipped below zero

#59

Post by ck2 »

They need to perfect the capture and storage technology and force all the Bakken oil field flares to use it.

Billion of cubic feet every DAY just burnt off into the atmosphere because the oil makes them more money. Over $100 Million per MONTH

Our country/world is insane with waste while people freeze and starve.

Re: Europe now has so much natural gas that prices just dipped below zero

#60

Post by speedylight »

jefftk wrote: post #5

Normally you run storage facilities neither all the way full nor all the way empty: you want to be able to smooth out fluctuations in supply and demand. Because of the war Europe is running gas storage near its upper limit, which means we should expect less flexibility and more price volatility: they won't want to draw them way down if we get a serious cold snap, and they have nowhere to put extra gas if it's warmer…

Are you saying that by holding onto so much gas that there’s less in active circulation therefore it leads price increases?
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