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UK GAS-Prompt prices rise as lower wind power forecast boosts demand

Prompt British wholesale gas prices rose on Monday morning as expectations of weaker output from the country’s wind farms from Tuesday boosted demand for gas from gas-fired power plants.

* The within-day contract was up 0.70 pence at 13.70 p/ therm by 0842 GMT.

* The day-ahead contract was up 0.90 p at 14.40 p/therm.

* Traders said high wind power output on Monday had left the UK gas market oversupplied but that this was expected to significantly fall on Tuesday, boosting day-ahead gas demand and pushing prices higher.

* Peak wind power generation is forecast at 12.9 gigawatts (GW) on Monday, falling to 4.1 GW on Tuesday, Elexon data showed.

* Gas for power demand was forecast at 29 million cubic metres (mcm) on Monday, rising to 44 mcm on Tuesday, Refinitiv Eikon data showed.

* “Today’s outlook is bullish, (due to) a large drop in renewable output (wind) and substantial increase in power generation,” Refinitiv analysts said in a daily research note.

* Britain’s gas system was oversupplied on Monday with demand forecast at 148.6 mcm and flows at 180.2 mcm/day, National Grid data showed.

* The August British gas contract was up 0.66 p at 15.65 p/therm.

* The August gas price at the Dutch TTF hub was up 0.20 euro at 6.18 euros per megawatt hour.

* The benchmark Dec-20 EU carbon contract was up 1.21 euro at 29.14 euros per tonne.
Source: Reuters (Reporting by Susanna Twidale; Editing by Alison Williams)

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