In this week's Market Movers Europe with Manraj Lamba:
- Economic outlook pressuring oil markets
- Cold weather tests European gas markets
- EU ministers meet again on gas price cap
- European Commission to publish green hydrogen rules
Oil markets look set to remain under pressure this week as the wider economic outlook continues to worsen.
The market will be keeping a close eye on the ripple effects of the G7 price cap and the EU’s Russian crude import ban, with Russia’s response expected any day.
So far, the impact has been more muted than many expected. The most notable effect has been tanker congestion in the Bosporus impacting Kazakh crude cargoes.
Monthly oil market reports from OPEC and the IEA, published on Tuesday and Wednesday respectively, will offer further insights on the near-term outlook for oil.
Europe’s first cold spell of the winter continues to test gas markets, with storage withdrawals accelerating as demand rises.
Germany, the EU’s biggest gas market, has seen its target for a 20% gas use reduction compromised so far this month.
EU energy ministers will meet once again on Tuesday to see if agreement can be reached on a gas price cap.
The European Commission has lowered its proposal for a Eur275/MWh cap to Eur220/MWh – but member states remain polarized.
Some countries are blocking efforts to accelerate renewable energy project development until the gas cap is agreed.
The European Commission is also set to publish its final draft of renewable hydrogen definitions on Thursday. The rules will determine criteria for renewable generation used to power electrolysis.
Wrangling between the Commission and European Parliament over the rules has led project developers to pause investment decisions, leading to widespread uncertainty and delays in the European hydrogen sector.
I’m Manraj Lamba, thank you for kicking off your Monday with S&P Global Commodity Insights