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Our February Chart of the Month HH and TTF futures curve backwardation.

Both US and European natural gas futures are in backwardation at the moment – but for quite different reasons. While HH has seen near-term expiry contracts rise in value through continued COVID-19 pandemic-induced supply shocks and weather-induced demand spikes, TTF is being driven by European power sector dynamics and links to HH. With increasing US LNG volumes being hedged at the TTF, it’s plain to see the TTF vs. HH spread is a key benchmark to watch in the global market.

This is part of our regular ‘Chart of the Month’ insight series. Every month, CME group publishes exclusive insight from gas market analysts at Timera Energy. Each chart looks at a lesser-known aspect of the global natural gas markets, coupled with a sharp, succinct explanation. If you are a gas trader looking for an edge, sign up to download the latest chart.