UK prices fall on high Norwegian flows, Dutch prices lift

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British wholesale gas prices fell on Tuesday morning as Norwegian gas flows increased after some maintenance and were set to further reduce demand in the wind power sector, while Dutch prices rose from a 3-month low.

For instant delivery, British Gas fell 15 pence to 119 pence per therm by 0856 GMT, down from 11 pence / 112 pence in the previous day.

Norwegian exports to Britain via the Langeled pipeline behind some maintenance ramp-downs were rated at more than 9 million cubic meters (mcm) per day, refinancing analysts said in a morning note.

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Demand is expected to soften further on Wednesday and next week, with demand expected to drop to 18 mcm / d on Wednesday due to increased wind power ramps to 43 mcm / d.

Maximum wind power generation is forecast to increase from 6.8 gigawatts (GW) on Tuesday to 16.5 gigawatts on Wednesday, Elexon data showed.

Most of the prices have risen since the Dutch TTF hubs reached their lowest level on Monday since the start of the war in Ukraine on 24 February.

The day-to-day contract rose 1.50 euros to 82.50 euros per megawatt (MWh), and the benchmark June contract rose 2.90 euros / MWh to 86.90 euros / MWh.

“Prices are rebounding this morning. TTF prices have reached the level of Asia JKM (Japan / Korea Marker LNG) prices, which means their negative potential is now limited,” said an analyst at Angie Energyscan in a morning report.

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Europe and Asia compete in the world market for liquefied natural gas (LNG) cargo.

Rested energy analyst Lu Ming Pang said in a note that the price of TTF has been declining in recent days due to stable gas pipeline flows, relatively warm climate in Europe, as well as stable air production. Meanwhile, concerns over Russia’s gas supply to Europe are dwindling, with the EU saying a new payment system could be met without violating sanctions imposed by Moscow-imposed Gazprombank, analysts say.

In the European carbon market, the benchmark contract rose 1.68 euros to 79.81 euros per tonne. (Reporting by Nora Bully, Editing by Susanna Tweedel)

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