LONDON: British spot gas prices rose on Monday morning as a colder weather outlook and an undersupplied system tightened the market.
Gas prices for delivery within the day opened at 70 pence on Monday morning, up 0.7 pence since Friday's close.
Traders said that the higher prices were a result of an undersupplied system.
Gas demand was expected to be 245.1 million cubic metres (mcm) on Monday, and with supplies seen only at 240.5 mcm, the system was seen to be 4.6 mcm short, according to data from National Grid.
The undersupplied system implied the need for withdrawals from Britain's gas storage sites, which are currently filled to an average of 87.4 percent, down from 98 percent in mid-November, according to Gas Infrastructure Europe.
Although Monday's demand was still over 20 percent below the seasonal norm, analysts said that they expected gas use to rise on Tuesday as cold weather moves in to Britain.
Current average temperatures of almost 10 degrees Celsius are expected to drop towards the seasonal norm of 5 degrees by Tuesday, meteorologists said, pushing up heating demand.
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