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UK GAS-Prices up on carbon hike and supply deficit

British wholesale gas prices increased on Monday morning following a surge in carbon’s value, and as flows from Norway remained low, leaving the market undersupplied.

* Day-ahead gas rose by 1.05 pence to 75.75 pence per therm by 0822 GMT

* Within-day gas price up 1.35 pence at 76.10 pence per therm

* A rise in carbon prices has caused a boost across gas contracts, said a British gas trader

* The benchmark Dec-18 EU carbon contract rose by 1.68 euro to 24.90 euros a tonne

* Gas supply from Norway, which remained at low levels, also helped the price move, added the trader

* The market is slightly undersupplied, with demand forecast at 151.4 million cubic metres (mcm) and flows at 149.8 mcm/day, National Grid data shows

* Gas supply from Norway to Britain was stable at 44 mcm per day as flows through the Langeled pipeline remained low

* Gas prices rose despite forecasts for stronger wind and warmer weather, that normally reduce gas demand

* Peak wind power generation was forecast at 8.4 gigawatt (GW) on Monday and is expected to rise to 9.2 GW on Tuesday, Elexon data shows

* Average daily temperatures in Britain are seen around 14.0 degrees Celsius on Monday and are forecast to rise to 15.9 C the next day, Thomson Reuters Eikon data shows

* October contract up 0.82 pence at 74.90 p/therm

* In the Dutch gas market, the day-ahead price at the TTF hub was up 0.50 euro at 28.70 euros per megawatt hour
Source: Reuters (Reporting by Lefteris Karagiannopoulos in Oslo; Editing by Emelia Sithole-Matarise)

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