In this week's Market Movers Europe with Felix Fernandez:
- EU's gas market correction mechanism to enter force
- Energy Council tackles reform in electricity market
- Earthquake disrupts steel production in Turkey
- Optimism in oil amid sanctions and disruptions
The EU's new gas market correction mechanism is due to come into effect on Wednesday.
It will be triggered if the TTF month-ahead gas price exceeds Eur180/MWh for three working days and the month-ahead TTF price is Eur35/MWh higher than an LNG reference price at the same time.
Although prices have come off considerably from the record highs of last year and currently sit well below the cap level, this price cap still represents a significant shift for the market.
On the energy front, Brussels watchers will be looking out for potential leaks on various energy dossiers this week, ahead of an informal Energy Council meeting at the end of February where the long-awaited reform of Europe's electricity markets will be discussed.
The European Commission recently proposed watered-down recommendations for consultation. It remains to be seen whether member states demanding radical surgery will accept a less interventionist approach.
In the steel markets the focus will be on Turkey, the world's largest importer of ferrous scrap, where many steel producers based in the earthquake-hit Iskenderun region have been forced to suspend normal operations.
Prolonged outages could have a significant impact on international scrap and steel prices.
The devastating earthquake has also caused disruption to oil flows in the Mediterranean, but the market has remained relatively steady despite this and Russia's announcement at the end of last week that it will cut its crude output in March in response to Western sanctions.
Two key monthly oil market reports, from OPEC and the IEA, are out this week offering insights on the state of the market.
I'm Felix Fernandez, thank you for kicking off your Monday with S&P Global Commodity Insights.