Far from closed Russian gas pipelines or a harsh winter: the price of European gas is inflated by the greed of investment funds. That’s what many energy industry analysts think. Who, after having accustomed us to increasingly soft tones, today openly use the word “speculation” to define the situation underway in recent months, especially from August to today, and which has brought the price of the commodity from 30 to 50 euros per megawatt hours. (The Republic)
Gas is increasingly a currency of exchange in relations between countries, in a constantly updated geopolitical map. The recent blackmail-smacking words of the US president-elect, Donald Trump, on the Truth platform can be read in this light: «The European Union must purchase our oil and gas on a large scale. The disruption of the flow of methane from Russia through Ukraine is the apparent reason; the movements of hedge funds and other investment funds on that market, however, is the real one.
European market rules oblige the ICE to publish every week the overview of the “long” (bullish) and “short” (bearish) positions of three main categories of investors in expiry gas contracts: banks, funds and commercial operators such as large energy-intensive companies or large distributors. It is this transparency that shows what is happening. An analysis by the TTF shows that, at least in the last twelve months, the price of gas has followed the moves of a specific category of ICE participants: a group of 380 hedge funds and other investment funds. They seem to have determined the prices with their choices, often purely speculative. The price of gas at the TTF has in fact risen in the last year with the growth in the volumes of bullish positions taken by the funds through futures, i.e. through derivative contracts expiring in a month or over other, mostly short periods.
