UK GAS Most prices edge lower on expectation of milder cold spell

The within-day contract dropped 0.45 pence to 41.25 p per therm by 0940 GMT. Gas-for-power demand is also expe
28 Nov, 2019
  • The within-day contract dropped 0.45 pence to 41.25 p per therm by 0940 GMT.
  • Gas-for-power demand is also expected to rise on Friday due to cold weather and low wind generation.
  • Liquefied natural gas (LNG) sendout is expected to be 2 mcm lower than on Wednesday.

The within-day contract dropped 0.45 pence to 41.25 p per therm by 0940 GMT.

The December contract dipped 0.55 p to 41.65 p per therm.

The day-ahead contract rose 0.45 p to 41.70 p per therm.

Britain's gas system was 6.2 million cubic metres (mcm) undersupplied, with demand forecast at 284.8 mcm and supply at 278.6, National Grid data showed.

Temperatures on Friday are forecast to drop below the season's norm, driving heating demand to around 216 mcm from 188 mcm on Thursday, Refinitiv data showed.

Gas-for-power demand is also expected to rise on Friday due to cold weather and low wind generation.

Wind production is expected to drop to 5.6 Gigawatts (GW) on Friday from almost 10 GW on Thursday, Elexon data showed.

However, the cold spell is expected to be shorter and less cold than predicted earlier, which has reflected in bearish prices for most of the contracts on Thursday.

Temperatures are forecast to rise above the season's norm from Wednesday, with residential consumption revised down for the weekend and next week, Refinitiv analysts said in a morning report.

On the supply side, flows from Norway edged up by 5 mcm to 99 mcm on Thursday, Gassco data showed.

Flows from UK Continental Shelf stepped up by 3 mcm to 144 mcm/per day.

Liquefied natural gas (LNG) sendout is expected to be 2 mcm lower than on Wednesday.

However, an influx of LNG cargo arrivals in Britain continues, with two more tankers carrying cargoes from the United States signalling Britain on Thursday.

Day-ahead gas at the Dutch TTF hub edged down 0.02 euro to 15.93 euros per megawatt hour (MWh), the December contract was 0.27 euro down to 15.88 euros/MWh.

The benchmark Dec-19 EU carbon contract slipped 0.11 euro to 25.00 euros per tonne.

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