LONDON: British winter gas prices rose to the highest level in nearly two weeks on Wednesday after oil prices touched a six-month peak in anticipation of a possible Western military strike in Syria.
The winter 2013 gas contract touched a high of 70.65 pence per therm in morning trading, up 0.20 pence on the previous session.
"Fundamentally we see no changes, it all seems like sentiment set by oil," an energy trader at a utility said.
Brent crude touched a high above $117 per barrel overnight and US benchmark crude prices rose to their highest in more than two years.
The oil market is concerned a military strike in Syria could result in turmoil spilling over to neighbouring countries in the oil-rich Middle East.
Closer in, British gas contracts also rose, buoyed by the bullish curve and a drop in imports from Norway.
The day-ahead gas contract traded at 64.15 pence, up 0.25 pence on Tuesday's closing price.
Within-day gas added 0.05 pence at 63.90 pence.
Imports from Norway via the Langeled pipeline dropped on Wednesday morning. The loss in supply was balanced out by resuming flows on the Norwegian Vesterled pipeline, which had been out of service since Aug. 24 for maintenance.
Demand for gas remained low at around 30 percent below seasonal norms, National Grid data showed.
The outlook for liquefied natural gas (LNG) supply was bleak with currently no cargoes scheduled to arrive in Britain.
Analysts at Thomson Reuters Point Carbon said they expected deliveries into the South Hook terminal to pick up in September due to weak demand for LNG in Asia next month and a narrower spread between Asian and UK prices.
The bullish gas curve also resulted in higher power prices, which in turn lifted the spark spread, the profit power generators make from burning gas for producing electricity.
Traders said the winter 2013 spark spread traded at 4.45-4.60 pounds per megawatt-hour, compared with levels below 3 pounds seen in late July.
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