Gas price: Ukraine and Europe. Market overview


The second half of January was marked by declining price dynamics and a significant intensification of trade on the UEEX. In addition, the signing by President of Draft Law 3176 removed the existing obstacles to the participation of the GTS Operator in exchange trading.

Ukrainian Energy Exchange

In the second half of January, the initiators of natural gas trading were 38 companies, which formed starting positions for both sale and purchase. In general of 280 starting positions were formed, most often for the purchase / sale of a resource in February or an underground storage facility with a transfer in February.


The initiator of the starting positions estimated the most expensive resource of January 2021, and the resources of the following months and UGS - cheaper. In general, there was a slight downward trend in starting prices, which was also characteristic of resource sales prices.


In total, in two weeks 313, 68 million cubic meters of natural gas were sold, of which 98% belongs to the resource of February. Also, for the first time on January 28, the resource of March was sold in the amount of 5,15 million cubic meters. The January resource has not been in demand for the past two weeks. Fluctuations in prices in the European market were reflected in the effectiveness of trading on the UEEX.


In the short-term market of natural gas of UEEX 132 thousand cubic meters of natural gas were sold for two weeks and the price fluctuated in the range of UAH 7801-8100 per thousand cubic meters.

European market

Prices of European hubs have fluctuated significantly recently due to weather variability, the need for gas to generate electricity, instability in LNG supply to Europe, and so on.
The lowest quotations were observed at the Hungarian hub CEEGEX, which as of January 28 amounted to 17,41 euros / MWh, which is equivalent to 223,09 dollars per thousand cubic meters. At other hubs, the spot price was higher - up to USD 296.
Contracts for the month ahead at the end of January were on average equivalent to current spot prices, and the quarter ahead and the season ahead were 11% cheaper. Uneven dynamics in oil prices has been observed over the last two weeks. The price of futures for April Brent oil as of Friday was USD 56 per barrel.

Prices of contracts with delivery in due time, USD / thousand cubic meters, 28/01/2020

InstrumentNCGCEGHTTFGaspoolTGE/POLPXCEEGEX/HUDEXAverage value
Day120,1519,0120,8320,2823,0817,4120,13
Feb2120,0419,3420,8419,9422,7217,3920,05
2Q2117,6617,8517,2417,4219,6717,7617,93
S-2117,5417,8017,1517,3219,6017,8117,87

Gas balance in Ukraine

Imports of natural gas from the European direction for the past two weeks amounted to an average daily value of 14,2 million cubic meters, while daily from Hungary 92%, from Slovakia - 8% of natural gas volumes. Imports from Poland were absent.
In addition, over the past two weeks, there has been a high level of natural gas inflows from Moldova - about 6.3 million cubic meters per day. The volume of domestic production ranged from 51,2 to 54.9 million cubic meters per day.
The lowest level of production is about 51 million cubic meters for the day observed on January 21, was the lowest figure for the last 5 years. Consumption fluctuated significantly against the background of changing weather conditions over the past two weeks. As of January 27, 21, 43 billion cubic meters of natural gas were stored in Ukraine , which is 6% less than two weeks ago.

Public procurement

Over the past two weeks, about 400 tenders were held for the purchase of natural gas with a total value of UAH 757 million incl. VAT. The largest of them are Ukrtransgaz’s tenders for the purchase of fuel for UGS needs. So, in two purchases AXPO Ukraine won, in one - Trafigura Ukraine. In each tender, the volume of procurement amounted to 20,33 million cubic meters, with delivery during 2021. The prices of the winners were UAH 5,82-5,95 per cubic meter incl. VAT.
Among other tenders, the largest lot was received by TEK - it will supply 7,5 million cubic meters to the Osterskyi apartment-operational part of the district at a price of UAH 5, 29 per thousand cubic meters including VAT. In general, prices fluctuated in a very wide range - from UAH 4, 85 to 10, 94 per cubic meter.


Interesting for the week

The GTS Ukraine operator purchased a balancing service and based on its results on January 19, 2021 entered into an agreement to provide a balancing service. According to it, the definition of marginal prices for the purchase and sale of natural gas is changed: the marginal price of sale / purchase is determined by reducing / increasing by the amount of adjustment of the sale price of natural gas by the gas transmission system operator, determined in accordance with the terms of the contract for balancing service for the relevant gas day.

The President signed the Draft Law 3176, which allows the GTS Operator to purchase natural gas on the exchange. On January 21, 2021, the President of Ukraine signed the draft Law on Amendments to the Law of Ukraine “On Public Procurement” 173176. The law allows the GTS Operator to purchase natural gas for the needs of balancing the system on the exchange. The law also provides for the possibility of purchasing natural gas by the customer of transportation services, the operator of gas storage facilities and gas distribution system operators to ensure their own economic activities, including for their own production and technical needs. After the entry into force of the Law, there is no need to purchase gas for balancing purposes through a system of public procurement linked to prices at European hubs, and will help create an internal short-term market price indicator.

Polish Minister of Foreign Affairs Zbigniew Rau does not rule out that the construction of the Nord Stream-2 gas pipeline may be blocked, but it will be done not by Germany but by United States. According to Rau, after the attempt to poison Russian opposition leader Alexei Navalny in Germany, the discussion about the feasibility of the pipeline intensified. However, it will benefit those who want to complete this investment project. Now the discussion of this issue in Germany has revived. "I would not expect much from this renewed discussion in Germany on this topic. Even if the blockade does take place, it will leave the United States, and this will be the reason why this investment project will not be completed,"- Rau said. Earlier, US President Joe Biden said he considered the Nord Stream 2 pipeline a bad deal for Europe. He intends to study the sanctions that were imposed by the Donald Trump administration earlier.