5 hours Ago By Alex Kimani
“ ,” Arne Lohmann Rasmussen, chief analyst at Global Risk Management in Copenhagen, told Bloomberg. “ e,” he added. Over the past couple of years, hedge funds and commodity traders have been reaping massive profits thanks to heightened volatility in global energy markets.
However, profits have been declining in the current year as volatility declines. Back in June, Singapore-based oil and commodities trading powerhouse the smallest profit since the 2020 oil crisis after volatility in energy markets hit new lows. Trafigura’s net profit dropped to $1.
47 billion in the six months through March, good for a 73% Y/Y decline from a record $5.5 billion posted a year earlier. The company’s revenue fell 5.
4% to $124.2 billion, while group equity increased to $17.3 billion.
The company’s energy division saw operating profit before depreciation and amortization drop by half, to $3.35 billion while the metals division recorded a 11% increase from a year earlier thanks to easier comps after the company took a large impairment charge for an alleged nickel fraud. Related: Hurricane Fury in 2024 Slows US Gulf Energy Production “ ,” Chief Executive Officer Jeremy Weir said in a report.
“ .’’ There’s a fair chance that Europe’s gas markets will not implode as feared thanks to ongoing success by countries in finding alternative supplies to replace Russian gas. European Union nations were scheduled to meet on Monday preparations for the winter with Ukraine having signaled it has no intention to renew a five-year pipeline transit agreement to supply natural gas to EU countries when it expires on December 31, 2024.
“ ,” Hungary said in a document shared with energy ministers. Whereas natural gas prices have declined sharply from the all-time highs they hit during the pandemic, current are more than double the pre-pandemic levels. Earlier, the EU to prepare for a world without Russian gas, with Ukraine gas amounting to 5% of total EU gas imports.
Austria, Hungary and Slovakia are likely to be the hardest hit when the imports are cut off; thankfully, they have been finding alternative sources. Two weeks ago, Azerbaijan’s state oil company, SOCAR, natural gas to Slovakia’s Slovenský plynárenský priemysel (SPP), the country’s largest state-owned energy operator. This came just a month after SPP a short-term pilot contract to buy natural gas from Azerbaijan as it prepares for a possible halt to Russian supplies via Ukraine.
Hungary and Bulgaria have continued receiving Russian gas as member states found technical solutions to pay Gazprom despite sanctions on Gazprombank. Meanwhile, other European nations have found alternative sources. For instance, major German utilities signed LNG deals with the UAE’s ADNOC.
Meanwhile, Turkey has said it is prepared to significantly increase natural gas exports to the European Union, desperate to further wean itself off Russian gas, but it won’t be easy or cheap: In order to do that, the most likely route is to re-export Azeri natural gas from Turkey. That, in turn, would require Turkey to take in more Russian gas to make up for the shortfall. Ankara is keen to play the role of savior and boost its leverage with respect to Brussels, but it wants some demand guarantees before it starts spending on the necessary infrastructure.
Meanwhile, Europe’s gas inventories remain healthy. According to Gas Infrastructure Europe (GIE) data, stood at 96.401 billion cubic metres (bcm); the w/w draw was 3.
56 bcm, well below last year’s 4.23bcm draw and slightly below the 3.68 bcm five-year average w/w draw.
Inventories have drawn by less than last year on 11 of the past 12 days, reducing the y/y deficit to 9.98 bcm from 11.40 bcm.
The European Centre for Medium-Term Weather Forecasting (ECMWF) show central European temperatures five degrees Celsius above the 30-year average at the start of next week and then remaining above average through to the end of the forecast period (24 December)..
