Week in a Glance: Gas, Taxes, Inflation & Quod Witch Day

The most interesting thing happened last week in the natural gas market. Hysteria has reached its current peak, and perhaps this is all that the bubble that has inflated in prices in this market wanted to tell us. The catalysts for the jump in natural gas prices were a fire and a disconnection of a connecting cable carrying 2 gigawatts of electricity from France to the UK, which was superimposed on calm weather in the North Sea and problems with generating electricity from wind farms. As a result, in terms of oil prices, European gas prices exceeded $ 150 per barrel.

The Kremlin obligingly offered a simple solution to the problem - to launch Nord Stream 2 thereby, in fact, establishing causal relationships in what is happening in the natural gas market.

We are more interested not in politics, but in how the market manages this situation. And he does the job. Britain began to de-mothball coal-fired power plants (not up to environmentalists today), uranium prices soared by 60% +, LNG sellers seriously thought of reorienting flows from Asia to Europe. In general, we continue to believe that natural gas sales are bound to generate significant profits in the medium term.

In the US, meanwhile, they talked about the need to raise taxes, which did not please buyers in the US stock market. And if you add here 5.3% of consumer inflation in the United States, it becomes quite uncomfortable on the eve of the FOMC meeting, the results of which will be announced this week on Wednesday. Well, witch day (Friday was the day of expiration for major derivatives in the US stock market) lived up to its name, provoking confident black weekly candles for major US stock market indices.

In addition to the above-mentioned FRS decision on the parameters of monetary policy in the United States, this week we will also see a decision by the Bank of England, which faces the same dilemma: continue to ignore inflation or finally tackle it. In general, the week of the Central Banks is announced.