The price of gas in Europe is falling amid strong wind output
The Dutch and British wholesale prices of gas fell on Wednesday after increasing the previous day, as stronger wind production offset lower solar output, and supply was stable.
LSEG data shows that the benchmark Dutch front-month contract for the TTF hub fell by 0.20 euros to 35.80 Euro per megawatt hour at 0747 GMT.
The British front-month contracts was 0.61 pence less at 83.29 cents per therm.
The total Norwegian exports have remained flat, but the gas processing plant Kollsnes will begin another maintenance shutdown tomorrow. This will affect 40 million cubic meters per day.
LSEG data indicated that temperatures in north-west Europe are expected to reach normal levels by next week.
The forecast for wind generation will be above normal until next week, which will offset the lower than normal solar output. Wind power typically reduces the demand for gas generated by power plants.
BNP Paribas analysts said that winter gas prices are being undervalued in Europe and America because the markets will tighten up more than they have been priced.
They said: "We believe that November 1, EU gas stocks will fall below the current target levels, which transfers the price risk to next Winter."
The EU gas market has not been long enough - despite a significant increase in LNG supply - to see both winter and summer prices drop significantly, they said.
The benchmark contract on the European carbon markets increased by 0.06 euros to 72.66 euro per metric ton. Nina Chestney reports.
(source: Reuters)
