LONDON: Wholesale natural gas prices in Britain dipped slightly on Wednesday morning in a balanced system with rising temperatures expected to reduce demand. Gas prices for delivery on Thursday were trading at 47.7 pence per therm at 0705 GMT, down 0.1 pence since the previous close.
The slight fall was a result of a balanced system and full storage sites as well as forecasts for warmer weather on Thursday.
National Grid data show that Britain's gas demand was expected to be 198.3 million cubic metres (mcm) on Wednesday, 6 percent above the seasonal norm, but with supplies seen at 198.7 mcm the high usage could be met without storage withdrawals.
Britain's gas storage sites are currently 99.2 percent full on average, according to data from Gas Infrastructure Europe.
"British North Sea flows were slightly lower than yesterday this morning, currently standing at 107 mcm, which I believe is a reaction to forecasts of a bit warmer weather tomorrow," one analyst said.
Meteorologists said they expected temperatures to rise from the current seasonal norm of 11.3 degrees Celsius to almost 13 degrees by Thursday, resulting in a dip in demand for heating gas to 110 mcm on Thursday from Wednesday's 120 mcm.
In Britain's wholesale power market, prices for baseload (24 hours) delivery on Thursday fell 1.30 pounds ($2.09) per megawatt-hour (MWh) to 41.30 pounds on the back of an improving outlook for available electricity generation capacity.
Reuters data show that combined available nuclear, natural gas and coal-fired power generation capacity is expected to rise from about 24.5 gigawatts (GW) to 25.5 GW between Wednesday and Thursday, and that available wind power capacity is expected to rise from 2.6 GW to 3 GW.
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