UK GAS-Prompt prices fall on warmer weather, higher wind power output

• The day-ahead contract was 0.55 pence lower at 14.60 pence per therm by 0822 GMT.
• Peak wind generation was forecast to rise to 5.8 GW on Thursday from 3.8 gigawatts (GW) on Wednesday, Elexon data shows.

British prompt gas price fell on Wednesday morning as warmer weather and stronger winds reduced gas demand for heating and power generation, leaving the system slightly oversupplied.

The day-ahead contract was 0.55 pence lower at 14.60 pence per therm by 0822 GMT.

The gas system was oversupplied on Wednesday morning by around 7 million cubic metres (mcm), with demand forecast at 195 mcm, well below a seasonal norm, and flows at 202 mcm per day, National Grid data showed.

Temperatures in Britain were expected to continue rising until Friday, with the rest of April expected to be warmer than normal, analysts at Refinitiv said.

A UK trader said higher than average wind power forecasts were suppressing the prompt because of lower demand from gas power plants.

Peak wind generation was forecast to rise to 5.8 GW on Thursday from 3.8 gigawatts (GW) on Wednesday, Elexon data shows.

Gas supplies from liquefied natural gas terminals were down by about 18 mcm per day as deliveries from Isle of Grain fell to near zero, with no cargoes set to arrive at the terminal in April.

There were, however, nine tankers expected to arrive at Britain's South Hook and Dragon terminals by the end of April.

The gas price for May delivery was down 0.08 pence at 15.40 p/therm.

The Dutch day-ahead price at the TTF hub was down by 0.30 euro at 6.88 euros per megawatt hour.

The benchmark Dec-20 EU carbon contract was 0.34 euro lower at 19.47 euros a tonne.