UK GAS-Prices jump as demand surge outstrips supply
British prompt wholesale gas prices jumped on Monday as a spike in demand due to colder weather and lower wind generation outstripped supply.
* Gas for immediate delivery rose 5.05 pence to 28.50 pence per therm at 0745 GMT.
* Day-ahead gas was yet to trade although the contract was bid at 27.00 pence, compared to a closing price of 25.10 pence per therm.
* The system opened undersupplied by 20 million cubic metres (mcm) with demand forecast at 186.2 mcm and supply seen at 167.7 mcm, National Grid data showed.
* The demand figure was very strong compared to the summer months and was 72 mcm above the seasonal norm, the data showed.
* Demand was boosted by falling temperatures prompting gas heating in some households to be switched on – residential demand is expected at 84 mcm, about 10 mcm higher than last week.
* Gas-for-power demand was also higher, after wind generation dropped off significantly to 3.2 gigawatts (GW) from close to peak capacity at 12 GW on certain days last week.
* Gas for power demand for Monday is at 57 mcm compared to levels of between 30 and 40 mcm on most days last week.
* On the supply side, flows from Norway through the Langeled pipeline remained low at 7 mcm/day, ahead of a shutdown expected on Tuesday for annual maintenance until Sept. 24.
* However, four liquefied natural gas (LNG) tankers are now expected to arrive in Britain in the next seven days, a relatively high number compared to recent weeks.
* Gas send-out rates from LNG terminals tend to increase in the days leading up to tanker arrivals as the facilities empty their storage to receive the new cargoes.
* In the Dutch gas market, the day-ahead gas price at the Dutch TTF hub was up 0.3 euro at 9.70 euros per megawatt hour.
* Benchmark Dec-19 EU carbon contract was 0.19 euro higher at 25.27 euros a tonne.
Source: Reuters (Reporting by Sabina Zawadzki; Editing by Susan Fenton)