LONDON: British prompt gas prices slipped on Wednesday due to a rise in Dutch imports and weak demand levels amid below-average temperatures and injection restrictions into the Aldbrough storage site.
Gas for day-ahead and within-day delivery both shed 0.40 pence to 54.20 pence per therm and 54.10 pence per therm, respectively, moving down as imports from the Netherlands rose overnight to around 12 million cubic metres per day (mcm/d) and left the UK gas system oversupplied, National Grid data showed.
Demand for UK gas also remained weak at over one quarter below seasonal norms, driven down by milder-than-usual weather and weak demand for gas injections into storage, traders said.
"The system is long and there is quite limited injection demand," one UK gas trader at a utility said.
The UK gas system was around 10 mcm/d oversupplied on Wednesday morning, shrugging off a 10 percent drop in imports from Norway via the Langeled pipeline.
Injections into the Aldbrough gas storage facility are due to be reduced by 153 gigawatt-hours per day (GWh/d) from 1100-2000 GMT on Wednesday, while withdrawals from the site will be limited by 178 GWh/d during the same period.
The benchmark front-season gas price also fell, shedding 0.30 pence day on day to 62.80 pence, reflecting the weak prompt and falling oil prices.
Brent crude slipped below $104 per barrel on Wednesday after a lack of signs for monetary stimulus from the US
French bank Societe Generale also cut its 2013-2017 gas price forecasts due to a weak demand outlook in recession-hit Europe.
But the bank raised its full-year 2012 price estimate by 3 pence to 50 pence per therm, after Norway's oil worker strike earlier this month pushed up average third-quarter prices.
In Britain's electricity market, spot prices also eased, reflecting wider supply margins following the early restart of a nuclear reactor and as it became cheaper to burn gas in power plants.
The day-ahead baseload power price shed 25 pence to 41.50 pounds per megawatt-hour.
EDF Energy's 620-megawatt (MW) Hartlepool 1 nuclear reactor was producing power again on Wednesday for the first time since it disconnected from the grid for a refuelling outage on June 23, one day ahead of schedule.
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