LONDON: British natural gas prices declined across the board on Friday as supply trumped demand, but analysts said bullish factors could support the market in the near term.
Day-ahead gas prices were down 1.7 percent at 37.25 pence per therm at 0810 GMT, while the further out front-month and winter 2014 contracts shed 0.7 percent each.
According to the National Grid, Britain's gas system was forecast to be oversupplied by nearly 7 million cubic metres (mcm) on Friday, with demand estimated at 151.6 mcm - well below the seasonal norm of 170.7 mcm.
Analysts at Thomson Reuters Point Carbon said looming supply from two liquefied natural gas cargoes scheduled to arrive next week also weighed on prices.
However, they added that cooler temperatures and concerns over rising tensions between Europe and Russia over the crisis in Ukraine could provide some price support over the next couple of weeks.
Temperatures across Britain are expected to drop below the seasonal average over the next two weeks, potentially increasing demand for gas.
In Britain's power market, prices for day-ahead baseload delivery were down 40 pence at 35.75 pounds per megawatt-hour.
There are three nuclear reactors offline, with a combined capacity of 1.6 gigawatts.
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