18.02.202513:42 Forex Analysis & Reviews: Update on gas market

The gas market has paused following a stunning rally recorded throughout last week. But we will discuss the technical outlook a bit later.

First, Russian gas deliveries to Europe via the TurkStream pipeline have reached a new all-time high for the second consecutive week. The calculations were conducted by TASS based on data from the European Network of Transmission System Operators for Gas (ENTSOG).

The increase in supply volumes highlights buoyant demand for Russian gas in the region, despite geopolitical tensions and efforts to diversify energy sources. The TurkStream pipeline provides stable gas deliveries to Southern and Southeastern Europe, bypassing transit countries, which enhances the reliability and predictability of energy supplies. According to ENTSOG, the primary consumers of gas supplied via TurkStream are Southern European countries, including Greece, Hungary, and Serbia. The growth in deliveries may be attributed to several factors, including high energy consumption due to seasonal temperature changes and the recovery of industrial production.

At the same time, experts point out that dependence on Russian gas remains a topic of debate in Europe, with ongoing efforts to develop alternative energy sources and supply routes. Nevertheless, TurkStream currently plays a crucial role in ensuring the region's energy security.

Additionally, attention should be given to the latest Gazprom Neft report, which, apart from figures, mentions that the company's management is still analyzing the impact of sanctions introduced in January on operations.

As for the financial indicators, Gazprom Neft's net profit under International Financial Reporting Standards (IFRS) decreased by 25% in 2024, amounting to 479.5 billion rubles. This decline occurred despite relatively strong operational results, as the company increased its hydrocarbon production by 5.3% in 2024, reaching 126.9 million tons of oil equivalent.

The company attributes the drop in net profit to several factors, including global oil price volatility, changes in tax legislation, and logistical adjustments caused by external pressures. Despite these challenges, the management emphasizes that the operational results demonstrate the company's business resilience and ability to adapt to new conditions.

Hydrocarbon production was pumped up by effectively implementing an investment program aimed at expanding the resource base and adopting advanced technologies. Particular focus was placed on developing new fields and improving the efficiency of existing assets. The company also actively expanded its liquefied natural gas (LNG) segment, considering it a promising growth catalyst.

"Gazprom Neft continues to focus on ensuring the country's energy security and reinforcing its position in the domestic market," the company's report states.

Technical outlook for gas market

As for the technical picture of natural gas, buyers need to consider how to reclaim 3.734. A breakout above this range will open a direct path to 3.915, followed by the more significant level at 4.062. The farthest target will be 4.224.

In case of a further decline, the first support level is seen around 3.567. A breakdown below this mark will quickly push the trading instrument down to 3.422, with the furthest support zone found at 3.268.