The price of gas in Europe has risen to a record high for a week due to increased demand and the Norway gas outage
The wholesale gas prices in the Netherlands and Britain rose on Tuesday morning as the weather in Norway was cooler and less windy, and the market tightened. Meanwhile, the need to fill gas storages continued to support the price.
The benchmark Dutch front month contract rose by 1.37 euros to 34.07 euro per megawatt-hour (MWh), which is $/11.32 mmBtu at 0841 GMT. This was its highest level since 28 April, according to LSEG.
The British equivalent rose 2.45 pence, to 81.65 p/therm. Meanwhile, the day-ahead contract increased 3.40 pence.
A trader stated that prices are higher because of the colder weather ahead, and low wind energy generation.
According to Elexon, the peak wind power generation is expected to increase from 3.7 gigawatts on Tuesday to 4.1 GW by Wednesday.
Analysts at Northern Gas and Power say that an unplanned outage in Norway's Dvalin gas field has caused a shortage of 7.6 million cubic meters (mcms) per day to the UK.
On Tuesday, the Norwegian gas flow to Britain was down by 35 mcm/day.
Analysts at Mind Energy (formerly known as Energi Danmark) said that the need to replenish European storage sites continues to support prices.
The EU's storages have reached 41% capacity, thanks to LNG inflows. However, the rate of LNG inflows is expected to drop in May and in June.
According to a draft of the European Commission's plans for the phase-out of Russian energy, it will propose in June a ban on new and existing gas spot contracts, and the remaining gas and LNG, by 2027.
The benchmark contract on the European carbon markets rose by 1,33 euros to 68,80 euros per metric tonne. Nora Buli, reporting from Oslo; Sonia Cheema, editing.
(source: Reuters)
