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EUROPE GAS-Prices break 100 euros for first time amid energy price surge

Dutch wholesale gas prices broke the 100 euro level for the first time on Tuesday morning amid wider energy market price hikes, supply concerns, low colder weather forecasts and a cut in French nuclear generation due to a strike.

The November gas price at the Dutch TTF hub, a European benchmark, TRNLTTFMc1 broke the 100 euro level, a new record high. The contract was 16.25 euros higher at 111.25 euros per megawatt hour by 0939 GMT.

The December price TRNLTTFMc2 also went above 100 euros, trading 15.77 euros higher at 110.99 euros/MWh.

“All energy prices – coal, oil, gas, power – are up. There doesn’t seem to be any let up to the rallying,” a gas trader said.

The market seemed to shrug off news that Nord Stream 2 has started filling one of its two pipelines with natural gas for tests, according to the operator on Monday.

Germany’s energy regulator has also asked Swiss-based Nord Stream 2 AG to provide assurances that the Nord Stream 2 pipeline meets regulatory requirements when it enters service, adding it cannot be ruled out that operations could start soon.

Brent crude oil futures rose to near three-year highs, with U.S. benchmark crude close to 2014 peaks, after the OPEC+ supplier group decided to stick to a gradual output increase plan rather than fully opening the taps. O/R

“North-west Europe day-ahead fundamentals remain relatively tight compared to the previous day,” said Refinitiv gas analyst Xun Peng.

Physical gas flows to Europe from Russia through the Mallnow pipeline are at 120 GWh/day, significantly lower than 540 GWh/day in late September, Peng added.

Day-ahead consumption for north-west Europe is forecast 300 gigawatt hours per day higher due to colder weather and less wind, which should push up demand for heating.

German wind power production is also expected to drop below normal from tomorrow.

In France, five nuclear reactors are operating at limited capacity due to a strike, reducing available production by 2.7 gigawatts.

In the British market, prices neared 250 pence per therm.

Around half of UK’s 8 GW nuclear generation capacity is offline for outages, both planned and unplanned, with some restart dates recently extended. POWER/GB

The benchmark Dec-21 EU carbon contract CFI2Zc1 was up 0.78 euro at 104.00 euros per tonne.

The benchmark Dec-21 British carbon contract UKAFMc1 was down 3.5 pounds at 65.50 pounds a tonne.
Source: Reuters (Reporting by Nina Chestney)

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