Oxford – European Traded Gas Hubs the markets have rebalanced

The European gas markets experienced significant volatility from 2020 to 2022 due to the global pandemic, increased demand in Asia, and decreased Russian pipeline gas supplies to Europe. This led to record-low and record-high prices in a short period. The focus of this paper is to analyze the European traded gas markets in 2023 to determine if they have rebalanced or if volatility persists. The Dutch TTF is identified as the leading hub with high activity and traded volumes. The paper also reviews long-term trends in eight selected hubs to assess if a pattern of rebalancing is emerging. Month Ahead spreads are crucial for pricing physical contracts and risk management of gas portfolios. The correlation coefficients show a rebalancing of markets in selected European hubs, while volatility in the benchmark TTF has also stabilized to some extent. The North American benchmark hub HH and European hub TTF are leading global gas benchmarks, followed by NBP for the British Isles. The JKM remains the primary price marker in Asia. Overall, the European gas markets have shown signs of rebalancing in terms of pricing, activity, and volatility by the end of 2023.