Record-high difference between domestic and European gas spot price

The persisting uncertainty on the Romanian gas market caused transactions to be carried out almost exclusively on the spot market, which builds up the risk of gas price increases at the slightest variation in demand; the difference between the domestic spot price of gas and European prices already hit an all-time high, president of the Smart Energy Association (AEI) Dumitru Chisalita argues.In a statement on Tuesday he explains that with the chilly temperature forecasts for the next 10 days and the still absent decision as to what will happen after April 1, the gas prices on the Romanian spot market could keep on rising."The gas price on Romania's Commodities Exchange spot market has increased 72% since the beginning of the year to date, compared to a 15% increase on the Dutch TTF market. Whereas at the beginning of the year the spot gas price in Romania was 4% lower than that on the European benchmark market - TTF Netherlands, on February 10 the price in Romania was 44% higher (specifically by EUR 25 higher than that in Europe). Although households will not pay more than the capped gas price of RON 0.31 per kWh VAT included, the state budget will be affected, because it will have to offset the difference between the capped price and the suppliers' costs of purchasing these gas amounts," the statement said.According to AEI, companies that consume over 50,000 MWh/year and that have freely set prices (they were not included in the capping scheme) will be greatly affected, as they are charged based on a formula linked to the spot price."This situation is caused by the instability generated by the ping-pong of the gas market liberalization, which has blocked the market, because everyone is waiting for an eminently political decision, without having the courage to sell or buy gas except in the short and very short term. Thus, at the slightest increase in demand for natural gas following the drop in weather temperatures, but also as a result of the 'rationing' of gas withdrawals from storage facilities, the 'apparent demand' is much higher than the 'gas supply planned to be made available', an aspect that has blown up prices on the Romanian spot market. No transaction was made on the GasForward Market in January and February 2025, 1.5 million cubic meters were traded on the GasForward Market in Central Counterparty Regime in January 2025, and 1.2 million cubic meters were traded in the first 10 days of February 2025. The gas amount traded on Romania's spot market was 18.6 million cubic meters in January 2025 and 12.7 million cubic meters in the first 10 days of February 2025," the AEI president said.