UK GAS-Prices rise on cooler weather, Norwegian supply worry

British wholesale gas prices rose to multi-month highs on Tuesday on cooler weather and concerns over Norwegian supply.

The within-day contract was 0.50 pence higher at 35 pence per therm by 0833 GMT.

The day-ahead contract rose by 0.12 pence to 34.50 p/therm.

The October contract was up 0.92 pence at 34.25 p/therm.

Contracts are trading at their highest levels since December.

Cooler weather forecasts and an unplanned outage in Norway had helped lift gas prices on Monday, said analysts at Energi Danmark in their morning report.

"We do not expect immediate big losses as fundamentals remain a bit supportive," they added.

An unplanned outage at Norwegian gas processing plant Kollsnes will continue to curb output by 20 million cubic metres (mcm) per day today.

Norwegian flows were 17 mcm/day higher on Tuesday at 73 mcm/day, but a potential risk of strike of Norwegian oil workers from Wednesday could curb gas production substantially.

Unions have warned strike action could close down 22pc of the country's oil and gas output, or 900,000 barrels of oil equivalent per day.

The latest forecast raised UK system-wide demand by 10 mcm/day to 111 mcm/day for Wednesday, Refinitiv analysts said.

Day-ahead gas demand for power was revised 21 mcm lower to 44 mcm/day due to above-normal wind power generation, they added.

Peak wind generation would rise from 3.2 gigawatt (GW) to 11 GW on Wednesday out of total metered capacity of around 18 GW, Elexon data showed.

The UK system was last over-supplied by 5.9 mcm, with flows forecast at 200.5 mcm and demand at 207.2 mcm, National Grid data showed.

In the Dutch gas market, the October contract was 0.11 euro higher at 12.43 euros per megawatt hour.

The benchmark Dec-20 EU carbon contract was 0.59 euro lower at 27.12 euros a tonne.