Sunday, June 7, 2020

UK Gas Prices Rise as Norway Imports Dip

August 13, 2019

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British wholesale gas prices rose on Tuesday morning as imports from Norway fell, creating undersupply.

Within-day gas price up 1.30 pence at 31.20 pence per therm by 0809 GMT.

Day-ahead gas price up 0.90 p at 30.50 p/therm.

"Prompt prices are all up a bit on lower supply," a gas trader said.

UK gas system undersupplied by 11.7 million cubic meters (mcm) with demand forecast at 153.3 mcm and flows at 141.6 mcm/day, National Grid (NGG) data showed.

Imports from Norway through the Langeled pipeline were 32 mcm, around 9 mcm lower than the previous day.

Traders said expectations of low output from the country's wind farms had also boosted within-day gas demand from power stations.

Peak wind power generation is forecast at 3.5 gigawatts (GW) on Tuesday, rising to 5.7 GW on Wednesday, National Grid data showed.

"We expect low wind power generation today; adjusting higher from tomorrow with wind speeds climbing later in the week and during the weekend," analysts at Refinitiv said in a daily research note.

Further out on the curve prices were mixed.

September contract down 0.60 p at 33.00 p/therm.

Winter 2019 contract up 0.25 at 49.75 p/therm

Day-ahead gas price at the Dutch TTF hub up 0.22 euro at 10.65 euros per megawatt hour.

Benchmark Dec-19 EU carbon contract up 0.15 euro at 26.85 euros per tonne.

(Reporting by Susanna Twidale; editing by Nina Chestney)

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