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UK GAS-Prices rise as cooler weather raises demand

British wholesale gas prices rose on Thursday morning as cooler weather forecasts pointed to increased demand.

* The day-ahead contract was 0.25 pence higher at 40.50 pence per therm by 0838 GMT.

* The within-day contract was up by 0.65 pence at 40.50 p/therm.

* The UK gas system was over-supplied by 6.8 million cubic metres (mcm), with demand forecast at 209.5 mcm, around 30 mcm below the seasonal norm, National Grid data showed.

* Local distribution zone consumption is forecast 12 mcm higher on Friday from Thursday as average UK temperatures fall to 9 degrees Celsius from 11C today, Refinitiv Eikon data shows.

* Gas-for-power demand is nominated at 40 mcm/d. The weekend forecast is nominated at 55 mcm/d, up 9 mcm from previous forecasts.

* Peak wind generation is forecast at 10.8 gigawatts (GW) on Thursday and 9.7 GW on Friday, out of total metered capacity of around 18 GW, Elexon data shows.

* On the supply side, maintenance at the Kollsness gas processing plant and the Karsto plant are expected to reduce flows from Norway despite the end of an outage at the Oseberg field scheduled on Friday, Refinitiv analysts said.

* The November contract rose by 0.55 pence to 42.25 pence per therm.

* At the Dutch TTF gas hub, the November price was up by 0.07 euro at 15 euros per megawatt hour.

* “We have a neutral to slightly bullish view for TTF NOV20, with a caveat that a small increase is possible particularly if the weather in November turns colder than normal, as it is indicated by the latest forecast. This could add to the bullish concerns for the rest of the winter,” said Refinitiv analysts in a monthly report.

* The benchmark Dec-20 EU carbon contract was 0.15 euro lower at 23.41 euros a tonne.
Source: Reuters (Reporting by Peter Hobson; editing by Nina Chestney)

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