US Natural Gas Exporters to Meet German Buyers

Meetings will take place in Berlin as Europe attempts to wean itself off Russian gas. Germany in particular depends on Russia for about 50% of its gas supplies making the American option important. LNG terminal developers in Germany are hoping this will help accelerate planning approvals.

LME Resumes Nickel Trading after One Week Halt

The LME (an HKEX company) suspended nickel trading for a week after a price surge caused by a short squeeze on Tsingshan Holding Group, the world's largest nickel producer, resulted in "disorderly conditions". Trading resumed on Wednesday 16 March 2022 at 8am.

The Russian invasion of Ukraine has put nickel prices in a tailspin following sanctions of the world's largest exporter of refined nickel and concomitant concerns on global supply.

Nickel demand is driven by stainless steel and battery pack demand in electric vehicles.

Distillate Prices Coming Down after Rising Faster than Crude

ICE Gasoil prices which started rising aggressively at the back-end of February 2022, have started to loosen up, with a 6% drop in the front month April (J22) contract (representing 100 metric tonnes of low sulphur gasoil for physical delivery) and a 5.5% drop in the adjacent contract, May (K22).

Volumes for April are just over 30K and for May just under 20K.

Over the last two years we have been used to seeing Gasoil front month futures trade at around the 500 to 800 mark, with recent events pushing it to a peak of 1522 USD per metric tonne. This has led to a daily 25% drop in the front month contract on 10 March 2022 as the market struggles to sustain such aggressive gains.

As might be expected, similar to the crude curve, the gasoil futures curve is backwardated. The spread between adjacent contracts in the first three futures months is about $40 per metric tonne.

The Rise of Brent Crude's K22 Contract

Front-month Brent futures, represented by the May 2022 contract (K22) peaked at $128 a barrel on Tuesday March 8 2022. 

It crossed to over $100 a barrel at the start of March following Russia's invasion of Ukraine on 24 February. K22 is currently trading at $116 a a a barrel with 102K contracts traded with an intraday rise of 4.7%.

The Brent curve is in backwardation with the June 2022 (M22) contract trading at $112 (rounded to the nearest dollar), with the front month trading at $4 per barrel premium, with a similar premium for July (N22) trading at $108 per barrel.

Not until the October 2022 (V22) contract do we see oil dipping below $100 a barrel.

We see similar backwardation and spreads in future pricing on the NYMEX WTI Curve. With WTI all the volume is on the front month with 104K contracts (and counting) traded on 10 March 2022. Comparing front month contracts. Brent is at a $3 premium to WTI.

S&P Global Swallows IHS Markit Whole

S&P Global (NYSE: SPGI) announced completion of its $140bn merger with IHS, uniting "highly complementary assets". Douglas L Peterson, President and CEO of S&P Global, praised the "innovate assets" as well as the "technology capabilities" of the two "world-class organizations".