LONDON: British spot gas prices edged up on Tuesday morning due to higher demand after touching their lowest level since September 2010 the previous day.
Prices for delivery on Wednesday were 0.15 pence higher at 35.45 pence per therm at 0743 GMT, having touched 35.00 pence on Monday, its lowest level Sept. 20, 2010.
Gas for immediate delivery was trading at 35.65 pence per therm, up 0.15 pence from the previous settlement.
Demand was forecast to be around 190 million cubic metres (mcm) on Tuesday, around 8.5 mcm above expected supply flows, National Grid data showed.
UK gas prices have been falling steadily since last autumn due to a mild winter and healthy supplies.
In June, total demand for gas in Britain fell by 9 percent year on year, National Grid data showed.
However, the current level of prices have made production from medium-efficient gas plants more profitable, lifting power sector demand for gas in June by 14 percent or 0.18 billion cubic metres year on year, analysts at UK-based consultancy Energy Aspects said.
But the market is still expected to be weak over the coming months.
"It remains hard to be bullish about the UK summer gas market, with supply threats posed by the Russia-Ukraine gas dispute and Nord Stream maintenance doing little to tighten the underlying gas market in June," Energy Aspects added.
In the third quarter, there is also alot more maintenance scheduled at Norwegian gas fields compared to last year. Injections into storage will be below average and exports to the Continent will also decrease as European storage facilities fill up.
Further along the curve, gas for delivery in the winter 2014/2015 season was 0.14 pence higher at 55.45 pence per therm.
In Britain's power market, prices for day-ahead baseload (24 hours) delivery were trading 1.70 pounds higher at 34.05 pounds per megawatt hour.
There are currently five nuclear reactors offline, with a combined capacity of 3 gigawatts.
Comments
Comments are closed for this article.