Goldman Sachs says LNG crossings through the Strait of Hormuz climbed to 21% of pre-war levels in September, up from just 4% in August, though gas supply still trails crude oil's faster recovery from the regional disruption. Europe closed the month with storage at 60% full against a 61% expected, leaving European gas prices exposed if the Gulf recovery stalls or winter turns cold.
LNG trails oil's recovery through Hormuz
Visible LNG crossings through the Strait of Hormuz averaged 21% of pre-war levels in September. That is up from just 4% in August, according to Goldman Sachs commodity analyst Samantha Dart. It is still far from normal, but it marks the first real evidence that gas flows are adapting to the disruption.
Crude oil found its way around the war faster than gas did. Cargoes reroute and grades substitute more easily, while liquefaction capacity, specialized vessels and long-term contracts make natural gas harder to redirect, so its recovery through Hormuz was always likely to trail crude's.
Europe's storage cushion thins
Northwest European LNG imports missed expectations by roughly 8 mtpa, or 13%, as stronger Chinese and South Korean buying pulled cargoes east. Chinese imports came in around 7 mtpa above expectations. South Korean imports landed about 6 mtpa higher, even though both countries still imported less than a year earlier.
US LNG deliveries came in around 13 mtpa below expectations at 118 mtpa. That was down from August's 141 mtpa. European storage ended September at 60% full versus the 61% expected, with low water levels on the Rhône cutting into French nuclear generation and forcing more gas into the power stack.
Winter hinges on weather and Gulf exports
A warmer start to October could lift storage toward 62%. That would keep Goldman's base case of €70/MWh for TTF at year-end intact, alongside an Asian JKM estimate near $24.85/mmBtu. But if winter Gulf LNG exports fail to climb much beyond 25% of normal and temperatures run about one standard deviation colder than average, TTF could climb toward €150/MWh by year-end.
Europe is entering winter with enough gas to avoid panic, but not enough to ignore the weather, or Hormuz.
Source: Investing.com
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