Gas prices to drop next week due to warmer weather
The wholesale gas prices in the Netherlands and Britain fell on Wednesday morning, as forecasts of warmer weather next week reduced demand.
LSEG data revealed that the benchmark Dutch front-month contract for the TTF hub had fallen 0.29 euros to 31.12 Euros per Megawatt Hour (MWh), or $10.55 /mmBtu by 0942 GMT.
The Dutch day-ahead rate was down by 0.85 euros at 81.95 euro/MWh.
The British day-ahead contracts was down 0.65 pennies at 82.50 pence/therm.
Mind Energy analysts stated that the weather forecasts for the next week indicate a cold, calm climate in Northern and Central Europe. However, by the end of the week, it appears the situation will begin to normalize.
The market, they said, seemed unconcerned about the outages that occurred in Norway and Algeria.
Forecasts from LSEG showed that temperatures in Northwest Europe will continue to drop until Saturday but then rise into the next week.
In a daily note, LSEG analyst YuriyOnyshkiv stated that "next week we will see a warmer (model) revision of the temperature forecast."
Analysts at Engie EnergyScan stated in a research report that the overall European net gas storage withdrawals will increase modestly on Wednesday, after a continued rise on Tuesday. However, market prices dropped in the morning, probably because of the upward revision to temperatures.
They said that the market did not seem to be ready for a definitively negative stance.
The benchmark contract on the European carbon markets was down by 0.69 euros at 80.54 euro per metric ton. (Reporting and editing by Susanna Twidale; Forrest Crellin)
(source: Reuters)
