UK and Dutch natural gas prices both closed up around 11% today to close at the highest settlement on record.

There are a few big debates on right now:

1) Does Russia actually have extra gas?

The latest Russian domestic storage for gas data is from June but it showed domestic supplies very low then. Now, it could have since filled up and they’re holding it back for Nordsteam 2 politics. Alternatively, Russia may not actually have extra capacity. Ominously, Russian oil exports have also faltered since June, despite all their OPEC+ protestations.

2) The best thing I read this weekend

I can’t remember if it was Nomura or Credit Suisse but it’s stuck with me. They said that the high prices now are a sign the market is trying to destroy demand, because if it doesn’t and the winter is cold, there is a very real risk of running out of natural gas. Obviously. the results of that would be catastrophic. That’s not necessarily a point about pricing but it’s a good way of looking at the current market.

3) Framed in US prices

US gas right now is trading at $5.57, which is an absolute bonanza for shale drillers. $6 gas was why the technology was invented in the first place. To compare, today’s Dutch prices are equal to around $26. Those are some compelling economics if you’re in the LNG business.

4) Coming to China

Power outages are suddenly hitting China hard. This is more about coal supply but they also have a call on LNG and will soon be pulling in more Russia gas as pipelines are built.