UK GAS-Prices rise on weak wind output, Norwegian outages

LONDON: British wholesale gas prices rose on Monday morning due to weak wind output and upcoming outages which will reduce supply from Norway.

The day-ahead contract rose by 0.95 pence to 14.70 pence per therm by 0853 GMT.

Gas for immediate delivery was 0.35 pence higher at 14.20 p/therm.

Warmer weather is forecast this week but there is higher-gas-for-power demand as wind output has dropped.

Reduced wind output typically raises demand for gas from power plants.

Peak wind generation is forecast at 1.5 gigawatts (GW) on Monday and 1.2 GW on Tuesday, out of a total metered capacity of around 15 GW, Elexon data showed.

Norwegian flows through the Langeled pipeline are at 6 mcm/d compared to 10 mcm/d on Friday.

A planned outage is scheduled to start tomorrow at the Aasta Hansteen field, creating a risk of a drop in Langeled flows to zero, Refinitiv gas analysts said.

There is also a planned reduction in capacity of the Vesterled pipeline from tomorrow.

The system is nearly balanced with flows forecast at 175 million cubic metres (mcm) and demand at 173 mcm/day, National Grid data shows.

UK July contract was up 0.80 p at 14.60 p/therm. The July gas price at the Dutch TTF hub rose by 0.18 euro to 5.13 euros per megawatt hour.

The benchmark Dec-20 EU carbon contract was down 0.10 euro at 21.90 euros a tonne.