EUROPE GAS - European prices are flat, but cooler temperatures support them

The Dutch and British gas price were not much different on Friday. This was due to the expectation of increased demand as the recent warmer temperatures are expected to be replaced by more normal seasonal temperatures.

Data compiled by LSEG revealed that the benchmark Dutch front-month contracts?at the TTF hub? were up 0.10 euros at 27.02 Euros per Megawatt Hour (MWh) or $9.26/mmBtu by 0828 GMT.

The Dutch day-ahead contracts was flat at 27,00 euros/MWh.

The British weekend gas price was up 1?pence to 69.00 pence/therm. However, the day-ahead contracts remained unchanged at 68.75?p/therm.

Saku Jussila, LSEG analyst, said that the demand for local distribution zones (LDZ), which is largely a reflection of heating demand, will increase on Monday as temperatures return to seasonal norms.

He said that while this would support prices, gains were likely to remain limited.

Georg Mueller, LSEG's meteorologist, said that "major colder than normal spells?are unlikely before the end... of the year. However, the final days in December could be very cold for Central Europe."

Daniel Hynes said that low storage levels of gas will require LNG arrivals to be high.

Data from Gas Infrastructure Europe showed that EU gas storage facilities were 71.29% full at the end of last year. This compares to 80.89% in the same period last year.

Natural gas prices in the U.S. have dropped almost 20% at the Henry Hub since December 5, when they reached a high of 35 months. This has increased the spread to Europe, and margins for LNG suppliers.

The benchmark contract on the European carbon markets was down 0.50 euros at 83.40 euro per metric ton.

Agnieszka Wesylewicz, LSEG analyst, said that the contract reached a 11-month high on Thursday of 84.40 Euros/ton due to expectations of a tighter supply by 2026. (Reporting and editing by Nora Buli)

(source: Reuters)