Surge in Gas Prices Amid Seasonal Expectations
The spot price of gas has seen a significant increase on the platform managed by the Romanian Commodity Exchange (BRM), rising by nearly 20 lei/MWh, which translates to an over 13% spike in just five days. This surge approaches the record levels observed earlier this year, despite it being summer—a time when seasonal trends typically lead to some of the lowest prices of the year, as analyzed by Profit.ro.
Underlying Reasons for Price Fluctuations
Before this information was shared here, it had been reported well in advance via Profit Insider. The primary factors contributing to this price increase include the maintenance shutdown of the Trans Adriatic Pipeline (TAP), which supplies Azerbaijani gas to Southern Europe, along with ongoing conflicts in the border town of Sudja, a key area reportedly occupied by Ukrainian forces. This location is crucial for the transit of Russian gas to Europe and remains the last operational point on the Ukrainian route.
Furthermore, the Republic of Moldova has declared a state of alert in its gas market following a proposal from Vestmoldtransgaz, the gas transmission operator under Romanian control, specifically Transgaz. The reduction in gas supplies from the east, both from the south where TAP is undergoing maintenance and from the north amid ongoing battles near the Sudja compression station, has led to increased domestic demand for gas exports.
Export Dynamics and Market Reactions
On Thursday, Transgaz reported that Romania exported 8.5 million cubic meters of gas (7.3 million cubic meters to Hungary, 0.6 million cubic meters to Moldova, and another 0.6 million cubic meters to Ukraine) while importing only 5.8 million cubic meters from Bulgaria, likely via the TurkStream pipeline. In contrast, the volume of gas entering Romania from Bulgaria had recently dropped from 75 GWh per day to just 62 GWh on Thursday.
Market Trends for Next-Day Gas Prices
The rising demand for exports, coupled with a decrease in regional supply, prompted an approximate 4% increase in the average price of next-day gas on the BRM on Thursday, rising from 159 lei/MWh the previous day to 166 lei/MWh.
Comparative Analysis of Previous Price Levels
This year, there has only been one other instance where gas spot prices exceeded this level—on January 8, during the peak of winter when gas prices typically reach their highest annual levels. The volumes traded on Thursday amounted to 44 GWh, representing around 20% of Romania’s current daily production and one-third of its daily consumption.
Energy Market Update: Gas Flow and Alerts in Eastern Europe
Recently, a total of 1.7 GWh was traded at the day’s peak price of 170 lei/MWh. This fluctuation in energy pricing comes amid ongoing geopolitical tensions.
Seismic Events and Tsunami Alerts
In a related note, two significant earthquakes struck off the coast of Kyushu, Japan, triggering a minor tsunami alert. This incident emphasizes the unpredictable nature of natural disasters and their potential impact on energy and infrastructure.
Gas Supply Dynamics Amid Conflict
Despite the ongoing conflict at the Ukrainian border, gas flows from Russia to Europe via Ukraine remain steady. According to the ICIS energy market platform, Russian nominations at Sudzha reached 37.2 million cubic meters per day, marking a decrease of 2.2 million cubic meters compared to the previous day.
Moldova’s Energy Situation
The Ministry of Energy in Moldova has initiated the early alert procedure for the natural gas market across the Prut River, following a recommendation from the transport operator, Vestmoldtransgaz, which is under the control of Romania’s Transgaz. A significant concern for Moldova is the transit of Russian gas from Gazprom through Ukraine, which supplies the breakaway region of Transnistria, including the major energy production facility, MGRES, operated by the Russian state company InterRAO.
Electricity Supply from Transnistria
Official data from Chișinău indicates that last year, electricity deliveries from MGRES in Transnistria accounted for 78% of the consumption on the right bank of the Prut, the area governed by Moldova’s constitutional authorities. Looking ahead, the transit of Russian gas through Ukraine may face disruptions starting next year, adding further uncertainty to the current situation at Sudzha.
