UK GAS-Day-ahead up on colder weather, lower wind forecasts
British wholesale gas for day-ahead delivery was up on Wednesday morning on expectations of colder weather and lower wind output, while other contracts dipped slightly.
* The day-ahead contract was 0.50 pence higher at 22.15 pence per therm at 0914 GMT.
* “Consumption is up as temperatures dip. Wind is going to drop tomorrow as well,” a trader said.
* Temperatures are expected to be at the seasonal norm today and then drop below normal until early April.
* Day-ahead local distribution zone consumption is 9 million cubic metres (mcm) higher than the previous day.
* Peak wind generation is forecast at 9.3 gigawatts (GW) on Wednesday, dropping to 2.8 GW on Thursday, Elexon data shows.
* Low wind output typically raises demand from gas-to-power plants.
* The market was undersupplied by around 11 million cubic metres (mcm), with demand forecast at 244 mcm and flows at 233 mcm/day, National Grid data shows.
* The weekend contract was 0.25 pence lower at 22.00 p/therm.
* The April contract dipped by 0.03 pence to 21.37 p/therm.
* In the Dutch gas market, the day-ahead gas price at the TTF hub was down 0.22 euro at 9.93 euros per megawatt hour.
* European power and gas prices have sunk to new lows this week as lockdowns due to coronavirus dent energy demand, though signs of a recovery in liquefied natural gas (LNG) buying in Asia could lend support.
* The benchmark Dec-20 EU carbon contract was 0.52 euro higher at 17.30 euros a tonne.
* Britain will hold an auction of EU carbon permits for the aviation sector this afternoon on ICE this afternoon.
Source: Reuters (Reporting by Nina Chestney)