LONDON: British gas prices for within-day delivery rose on Monday as a drop in imports from Norway left the market undersupplied, prompting withdrawals from storage sites.
The within-day gas contract rose 0.17 pence to 69.60 pence per therm in morning trading, lifted to attract additional supply to meet high demand levels.
"Gas demand has risen once more today as the UK is going through a deeper spell of cold weather," said one gas trader.
British gas demand was pegged at 317.6 million cubic metres per day (mcm/d) at 0900 GMT, around 12 percent above seasonal norms as cold weather prompted higher gas use in heating systems.
Temperatures in Britain were measured below freezing point in northern parts of the country, levels below those usually seen at this time of the year, Britain's Met Office said.
The gas system struggled on Monday to meet high demand levels, with supply insufficient due to a drop in imports from Norway via the Vesterled pipeline.
Flows through the pipeline roughly halved overnight, as Norway's Statoil announced a 12.9 mcm/d cut in gas production without giving further details.
The gas system was around 10 mcm/d undersupplied at 0900 GMT, National Grid data showed.
Within-day prices rose to attract input from storage sites, with nominations set at 22 mcm/d.
The Holford and Rough storage sites were adding combined flows of around 30 mcm/d to the system on Monday morning, National Grid data showed.
Further out, prices eased on an improved supply outlook as a further liquefied natural gas (LNG) cargo was scheduled for delivery in late November.
The Al Mafyar tanker is expected to arrive at Britain's Isle of Grain terminal on Nov. 29.
Across the curve, gas contracts also shed value due to bearish impact from the oil market where the signing of a breakthrough nuclear deal with Iran eased pressure on prices.
Brent crude dropped by as much as $3 per barrel on Monday.
This led front-season gas prices in the British market 0.05 pence lower at 64.35 pence per therm.
In Britain's over-the-counter power market prompt prices rose in line with firmer gas prices, reflecting higher demand amid cold weather conditions.
The day-ahead baseload power price gained 70 pence to 56.85 pounds per megawatt-hour.
Wind power output was also lower than levels seen over the past week, further adding upward pressure to spot prices.
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