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Russian gas sales on ESP slow in July, delivery period shifts to winter

Russian gas sales on Gazprom Export’s Electronic Sales Platform (ESP) have slowed so far in July, while the volumes sold have been predominantly for delivery in the upcoming winter.

Sales so far in July average 165 million cu m/d, well down on the average daily sales in June of 245 million cu m/d.

The trend for ESP sales this month is for delivery in Q4 or Winter 20/21 (October 2020-March 2021), with only limited sales for delivery in the remainder of this summer.

All of the sales in July so far have been for longer-term delivery, while sales for prompt delivery have dried up entirely.

There have been no ESP sales for prompt delivery — within-day, day-ahead or balance-of-month — since May 21 as prompt prices slumped to record lows.

Sales in July have been for delivery to six points: the German Gaspool and NCG hubs; the Slovakian and Austrian virtual trading points; the Czech-German interconnection at Olbernhau; and the Austrian hub of Baumgarten.

Bereg volumes

The latest sales update from Gazprom Export also includes the result of auctions held at the end of June, and included a second giant sale of gas for delivery to the Hungarian interconnection point of Bereg in Gas Year 20.

Two sales of 0.55 Bcm took place in two consecutive auctions at the end of June for a total of 1.1 Bcm sold for delivery to Bereg.

The Ukrainian and Hungarian gas grid operators created Bereg as the sole virtual interconnection point between the two countries, replacing the Beregovo and Beregdaroc interconnection points, from May 1.

The 1.1 Bcm sold at the end of June is the equivalent of 3 million cu m/d.

Hungary has also secured 4.2 Bcm of gas from Gazprom for the next gas year, running from October 1, 2020, to September 30, 2021, under a short-term contract.

The total volume of gas sold on the ESP on June 25 was 0.75 Bcm — the highest daily volume sold since the platform was launched in September 2018.

However, the majority of the volume sold was for annual or quarterly delivery, meaning a lower volume on a daily delivery basis.

In all, gas sales on the ESP now total 36.28 Bcm since the first sale took place in September 2018.

Price index

Meanwhile, the average price of gas sold on the ESP has fallen again to its lowest ever level, with the July average so far at Eur6.778/MWh.

In June, the price averaged Eur7.248/MWh,

Gazprom Export began publishing its so-called ESPGazEX index in April last year, which represents the average price of ESP sales in any month — regardless of delivery period.

The highest average monthly price of gas sold on the ESP was Eur28.766/MWh in October 2018.
Source: Platts

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