UK GAS-Prices rise as colder weather, higher demand looms
Prompt British wholesale gas prices rose on Monday, despite a well-supplied market, in anticipation of a shift to lower autumnal temperatures and higher gas consumption.
* Within-day gas prices were up 2.05 pence at 72.75 pence per therm by 0840 GMT.
* The day-ahead gas price was 0.85 pence higher at 72.85 p/therm
* Monday’s rises offset price falls on Friday after potential industrial action in some North Sea platforms was averted.
* Supplies from the UK Continental Shelf were expected to be 8 million cubic metres (mcm) lower, reflecting a smaller intake at the St Fergus and Bacton SEAL gas terminals
* Liquefied natural gas (LNG) send out remained flat despite the delivery of a cargo at the Isle of Grain from the Russian Arctic Yamal facility over the weekend.
* The gas system was oversupplied by 11.2 mcm, with demand forecast at 151.5 mcm and flows seen at 162.7 mcm.
* Gas demand, however, was 30 mcm below the seasonal norm, according to National Grid data.
* Weather watchers monitored by Thomson Reuters gas analysts increased their temperature forecast for Monday by 3.3 degrees to 16.4 degrees Celsius.
* But temperatures are expected to drop next week, with gas consumption expected to rise to 86 mcm a day — 16 mcm higher than last forecast on Friday and 18 mcm higher than on Monday.
* The market is also sensitive to news of potential strike action by Total workers on three North Sea platforms.
* A Monday strike was cancelled after talks with workers progressed last Thursday but Unite the Union had previously planned strikes on Oct 1, Oct 15 and Oct 29
* Prices across the curve also rose
* October contract rose 1.7 pence to 73.00 p/therm
* Winter 2018 contract up 1.33 pence at 78.48 p/therm
* The day-ahead gas price at the Dutch TTF hub up 0.75 euro at 27.98 euros per megawatt hour.
* Prices at the Continental hub were boosted by reduced Russian gas flows along a pipeline crossing Ukraine into Slovakia, which had previously spiked.
* Benchmark Dec-18 EU carbon contract up 0.32 euro at 20.34 euros per tonne.
Source: Reuters (Reporting by Sabina Zawadzki, editing by Louise Heavens)