Last week was one of the first weeks since gas had a steady and strong bounce, most of it made on Friday night as markets rallied along with commodities which rallied a bit further than stock markets.
Last week, I wrote that I still kept my bearish thesis on natural gas. During the week I cut my short just a couple of moves down my entry at a profit and didn’t open new ones given that the price was clearly showing buying pressure. I still hold the same views, fundamentally though I will be waiting for further information until I open new shorts.
About my last post on gas, I was criticised for describing the parabolic move in gas as irrational and not as really indicative of the gas shortage problem. The criticism was made with the point that had Europe not found a replacement for Russian gas flows, the situation would have been dire.
My observation is different in the sense that of course, Europe would find a replacement for Russian gas and why wouldn’t they? Had we started building pipelines with Spain and France to increase connectivity with the African supply, the situation would have been even much better, but it’s actually incompetence and complacency from our European leaders which is pulling us back as Europe could have done much more. One of the culprits blocking the new gas connections with Spain and the rest of Europe is the genius statesman Emmanuel Macron.