Wholesale gas prices in Britain and the Netherlands fell mainly on Monday as mild weather, full gas storage tanks and plentiful arrivals of liquefied natural gas (LNG) tankers are curbing supply concerns across the country. short term.
The previous month’s benchmark Dutch contract fell 8.75 euros to 133 euros per megawatt hour (MWh) by 0922 GMT, the lowest level since late June.
The Dutch contract for the first quarter of 2023, typically the coldest period of the year with highest demand, fell €8.80 to €156.70/MWh.
The previous month’s British contract fell 17.50 pence to 240 pence per therm.
The mild weather outlook was the main driver today, analysts said.
The rest of October will be milder with temperatures above normal but partly unsettled conditions with occasional rain, Refinitiv meteorologist Georg Mueller said.
“Storage rooms are full to the brim and LNG is still lining up, so we could be headed for oversupply,” said one European industry analyst, adding that he expected more pessimism.
European storages are nearly 92% full, exceeding pre-winter European targets, data from Gas Infrastructure Europe showed.
However, reports that local Chinese utilities have been asked to stop diverting LNG cargoes to Europe could limit the downside, the analyst added.
Closer to home, the Dutch daily contract fell €4 to €63/MWh, its lowest level since the end of October 2021.
In the UK, the daily contract was the only contract to buck the downtrend, trading higher by 11.50 pence at 105 pence/therm.
Gas demand for heating and power production will increase on Tuesday, Refinitiv analysis showed.
In the UK, the gas system was oversupplied by 11.7 million cubic meters (mcm), according to National Grid data.
Peak wind generation was forecast to fall from 15.5 gigawatts (GW) today to 7.9 GW on Tuesday, out of a total measured capacity of around 20 GW, Elexon data showed.
In the European carbon market, the benchmark contract was €0.87 lower at €67.15 a tonne.
Source: Reuters (Reporting by Nora Buli in Oslo; Editing by Shailesh Kuber)