Prices rise as increased IUK exports help lessen oversupply
British wholesale gas prices rose on Wednesday, partly correcting the previous day’s losses, as exports through the InterconnectorUK to Europe increased.
* Day-ahead gas was 2.00 pence higher at 27.00 pence per therm by 0800 GMT.
* Within-day gas rose by 1.25 pence to 26.50 pence per therm.
* The drop in prices was severe on Tuesday so the market corrected itself on Wednesday, a British gas trader said, adding that especially the day-ahead price “got smashed yesterday”.
* Crude oil prices, which had fallen as much as 3% in the previous session, due to the deepening of the trade war between the United States and China, weighed on the European energy complex.
* Although prices are still near 7-month lows, the decrease was not as steep on Wednesday.
* IUK exports have increased to 11.8 million cubic metres (mcm) from 5.2 mcm on Tuesday, which has helped to lessen oversupply which has been weighing on prices since the start of the week, traders said.
* The system was largely balanced. Demand was forecast at 129.9 million cubic metres (mcm) and supply seen at 131.2 mcm per day, National Grid data showed.
* Total Norwegian flows to Britain are stable at 43 mcm/day.
* Average daily temperatures in Britain are forecast to reach 17.1 degrees Celsius on Wednesday and are seen largely stable until the end of the week.
* Wind generation is expected to be at around 6.4 gigawatts (GW) on Wednesday and fall to 5.5 GW on Thursday.
* The month-ahead contract rose by 0.25 pence to 30.60 pence per therm.
* Dutch day-ahead gas rose by 0.13 euro to 9.90 euros per megawatt hour while the September contract was up by 0.15 euro at 11.15 euros/MWh.
* The benchmark EU carbon price edged up by 0.29 euro to 28.70 euros a tonne.
Source: Reuters (Reporting by Lefteris Karagiannopoulos in Oslo; editing by Nina Chestney)