UK GAS Prompt prices rise as temperatures turn cooler

• The day-ahead gas price at the Dutch TTF hub was up 0.65 euro at 16.25 euros per megawatt hour.
• Peak wind power generation is forecast at 5.5 gigawatts (GW) on Friday, falling to 4.7 GW on Saturday.
• Traders said colder temperature forecasts than had previously been expected.

LONDON: Prompt British wholesale gas prices rose on Friday morning as cooler temperatures led to an increase in gas demand.

The within-day contract was up 0.80 pence at 42.00 p/therm by 0930 GMT.

The day-ahead contract was up 1.60 pence at 42.60 p/therm.

Traders said colder temperature forecasts than had previously been expected, combined with low output from the country's wind farms, had boosted gas demand.

"There is still a lot of supply though," one trader said, adding this was keeping a lid on price gains.

The average temperature in Britain is expected at 3.7 degrees Celsius on Friday, Eikon Refinitiv data showed, 4.2 degrees lower than previously forecast.

"Temperatures in the UK are expected to drop below seasonal normal from today and should continue to decline over the weekend until Monday," analysts at Refinitiv said in a daily research note.

Peak wind power generation is forecast at 5.5 gigawatts (GW) on Friday, falling to 4.7 GW on Saturday, National Grid data showed.

Britain's gas market was slightly oversupplied on Friday, with demand forecast at 315.8 million cubic metres (mcm) and supply flows forecast at 319.2 mcm.

Strong supply is expected over the next few weeks, with 13 liquefied natural gas (LNG) tankers scheduled to arrive in Britain by Dec. 15.

Further out on the curve, prices also edged higher

The December gas contract was up 0.81 p at 41.65p/therm.

The summer 2020 contract was up 1.25 p at 39.50 p/therm.

The day-ahead gas price at the Dutch TTF hub was up 0.65 euro at 16.25 euros per megawatt hour.

The benchmark Dec-19 EU carbon contract was up 0.02 euro at 25.03 euros per tonne.