UK GAS-Prices fall on rising Norwegian supplies, wind power output

• The day-ahead contract was down 1.0 pence at 19.00 pence per therm by 0842 GMT.
• Total LNG send-out is nominated at 64 million cubic metres (mcm) on Friday, up from 61 mcm the previous day.

British wholesale gas prices fell on Friday morning as supplies from Norway rose, while gas demand for power generation was forecast lower due to higher wind power output.

The day-ahead contract was down 1.0 pence at 19.00 pence per therm by 0842 GMT.

"The oversupply is helped by higher Langeled flows (from Norway) and forecasts for lower gas (demand) for power," Refinitiv gas analysts said.

Total LNG send-out is nominated at 64 million cubic metres (mcm) on Friday, up from 61 mcm the previous day, Refinitiv data shows.

Norwegian flows to the UK were at 87 mcm, 7 mcm higher than yesterday, data from Norway's gas system operator Gassco showed.

The market was oversupplied by 13 mcm, with demand forecast at 241 million cubic metres and supply at 254 mcm, National Grid data shows.

Peak wind generation is expected to rise to 11.8 gigawatts (GW) on Saturday from 7.2 GW today, Elexon data shows.

Higher wind output typically reduces demand from gas-to-power plants.

Further out on the curve, the April gas price was 0.72 pence lower at 18.63 p/therm.

Norway has cancelled much of its maintenance for the second quarter because of the coronavirus (COVID-19), making it likely that its production will be stronger than previously expected for at least the first half of summer, said consutancy Energy Aspects.

"The changes to the Norwegian maintenance schedule are yet another bearish factor for European gas prices caused by COVID-19, albeit one of the first supply-side effects after several weeks that indicated that the virus was weakening global gas demand," the analysts added.

In the Dutch gas market, the day-ahead gas price at the TTF hub was down 0.13 euro at 7.50 euros per megawatt hour, its lowest since Sept. 2019.

The benchmark Dec-20 EU carbon contract was down 0.70 euros at 16.65 euros a tonne.