European gas prices fell the most in 11 months as President Vladimir Putin ordered some troops back to their bases after exercises, potentially easing concern that tensions between Russia and Ukraine may disrupt flows.
U.K. natural gas for next month, a regional benchmark, fell as much as 5.2 percent on ICE futures Europe, the biggest decline since March 28 last year. Dutch gas for April fell 5.1 percent, the most since April 2, according to broker data compiled by Bloomberg.
Europe’s mildest winter since 2007 has left the region with enough gas in storage to cover any potential disruption in flows from Ukraine for about 45 days, according to Sanford C. Bernstein & Co. European gas prices jumped the most since September 2011 yesterday after Putin ordered the deployment of troops to Crimea, a Black Sea region in Ukraine.
“We are past the peak winter demand period,” Michael Hsueh, an analyst at Deutsche Bank AG in London, wrote yesterday in a report. “Factors which will moderate the potential impact are the fact that gas storage levels across Europe are at unusually high levels.”
The U.K. next-month contract fell to as low as 58.50 pence a therm ($9.77 per million British thermal units), and traded at 58.60 pence at 8:36 a.m. in London. Dutch gas for April dropped 1.3 euros to 24.10 euros a megawatt hour ($9.71 per million British thermal units).
Both Gazprom, the world’s biggest exporter of the fuel, and Ukrainian national pipeline manager Ukrtransgaz said yesterday that the transit flows have not been disrupted.
The Kremlin continues to have 16,000 troops deployed in Ukraine’s Crimea region, after ousted president and Putin ally Viktor Yanukovych fled to Russia. Russian forces ordered Ukrainian warships in Crimea to surrender, Ukraine’s acting President Oleksandr Turchynov said yesterday.
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