EUROPE GAS - European prices flatten as market searches for impetus

Dutch and British gas rates traded sideways on Monday morning in the absence news that would have influenced either direction. However, cooler weather with less wind is expected to support prices.

LSEG data shows that the benchmark Dutch front-month contract was 32.31 euros per Megawatt Hour (MWh) or $11.14/mmBtu at 0834 GMT. This is a 0.03 euro increase.

The Dutch day-ahead contracts was up by 0.20 euro to 32.20 euros/MWh.

The British gas front-month contract gained 0.18 pence, to 80.58 pence/therm. Meanwhile, the day-ahead price was up 0.65 p/therm at 80.50 pence.

Saku Jussila, LSEG analyst, said that he expected sideways trading on Monday as nothing was new or significant compared to the previous day.

Jussila said that cooler temperatures and less wind are expected to increase gas demand. Meanwhile, Norwegian gas supplies have increased due to the end of some maintenance outages.

Elexon data shows that the peak British wind energy generation will fall from 9.7 GW on Monday to 5.6 GW Tuesday.

Data from Gassco, the infrastructure operator, showed that Norwegian gas flows were nominated as 285 million cubic meters per day. This is up from 235mcm/day last Friday.

Analysts at Mind Energy stated in their morning report that the market showed little reaction to the plans of the European Commission, which is to phase out Russian supplies of liquefied gas by 2027. This would be a year sooner than originally planned.

They added, "But it might have an impact if there are major changes in the demand in Asia or in Europe during a cold winter."

Gas Infrastructure Europe's data shows that EU gas storage facilities, which are needed to meet increased demand in winter, were 81.6% filled at the end of last year compared to 93.6% last year.

The benchmark carbon contract in Europe was down by 0.27 euros at 77.28 euro per metric ton. Nora Buli, reporting from Oslo; Barbara Lewis, editing)

(source: Reuters)