LONDON: British prompt gas prices rose slightly on Wednesday morning as a drop in Norwegian supplies left the system undersupplied despite low demand, while prices further out on the curve continued to drop on the gloomy economic outlook.
Gas prices for next day delivery were up 0.15 pence per therm to 53.80 pence at 0915 BST (0815 GMT), and within-day prices were up 0.35 pence to 54.10 pence a therm.
The rise came despite low gas demand of 176.3 million cubic metres (mcm), almost 30 percent below the seasonal average, according to data from National Grid.
Analysts said the rise was a result of falling supplies through the Langeled gas pipeline from Norway, which fell by 25 mcm in the morning to 25 mcm.
"Flows through Langeled are substantially down and give a clear bullish signal and the lower flows also lead to a short system this morning," analysts at Point Carbon said.
As a result of these drops, Britain's gas system was expected to be around 13 mcm undersupplied on Wednesday.
But because of the low demand, Point Carbon said it did not expect spot prices to rise further, but instead to move sideways in a range of 53.80 and 54.30 pence per therm.
Further out on the curve, the market mood remained bearish.
Gas prices for delivery next winter were down 0.25 pence to 63.60 pence per therm, their lowest level since the first quarter of 2011, before the Arab Spring cut gas supplies from North Africa.
Traders said the gas market was currently closely monitoring the oil market, where front-month Brent crude prices were back below $96 a barrel on Wednesday morning.
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