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UK GAS-Prompt prices remain near 22-month lows on oversupply

British wholesale gas prices mostly fell on Wednesday morning, with prompt prices remaining close to 22-month lows due to oversupply.

* Gas for immediate delivery down 0.50 pence at 31.10 p/therm by 0849 GMT, while the day-ahead gas price inched up by 0.13 pence at 31.30 p/therm.

* Prompt gas prices have halved since the beginning of the year and are currently around their lowest level since June 2017 according to Eikon Refinitiv data.

* Traders said the slight increase in the day-ahead contract was due to a rebound from a 7 percent drop on Tuesday, but said high sendouts from the country’s liquefied natural gas (LNG) terminals and strong imports from Norway has left the market oversupplied.

* Gas system oversupplied by 26.4 million cubic metres (mcm) on Wednesday with demand forecast at 302.3 mcm and flows at 328.7 mcm/day, National Grid data showed.

* “Oversupply is due to strong LNG sendout nomination of 91 mcm. Dragon is notably high at 27 mcm,” analysts at Refintiv said in a daily research note.

* At least seven LNG tankers are expected to arrive in Britain in the next few weeks.

* Asian spot prices for LNG have fallen to their lowest level in nearly three years due to excess supply and a lack of buying interest in the region.

* This has led to more LNG tankers coming to Europe.

* Further out on the curve most prices slipped.

* May contract down 0.15 p at 31.98 p/therm.

* June contract down 0.47 p at 31.80 p/therm.

* Winter 2019 contract flat at 50.50 at 39.05 p/therm

* Day-ahead gas price at the Dutch TTF hub flat at 13.75 euros per megawatt hour.

* Benchmark Dec-19 EU carbon contract up 0.79 euro at 22.83 euros per tonne.
Source: Reuters (Reporting by Susanna Twidale; editing by Nina Chestney)

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