British and Dutch gas prices were mostly down on Tuesday morning after the French nuclear regulator said it would tweak rules that would keep nuclear plants running during a heatwave.

The British contract for immediate delivery was up 8.00 pence at 278.00 pence per therm by 0952 GMT, after rising to 298.00 p/therm in earlier trade.

The day-ahead contract fell by 10.00 pence to 270.00 p/therm after rising to 300 p/therm earlier.

In the Dutch gas market, the day-ahead contract fell by 3.17 euros to 189.13 euros per megawatt-hour (MWh), while the front month contract fell by 1.50 euros to 190.50 Eur/MWh.

Norway’s government said on Monday it will more tightly regulate its power production and could ultimately limit exports to prevent hydroelectric reservoirs levels from running out of water.

On the other hand, France’s nuclear power regulator has extended temporary waivers allowing five nuclear plants to continue discharging hot water into rivers as the country contends with a fourth heatwave of the summer.

“Gas prices have been settling down a bit due to more power production and the fact that France told some power plants they can dump hot water into rivers,” a European gas trader said.

He added that there were fears that production would drop because river levels were too low and utilities cannot drop hot water in low river levels.

“The focus now is shifting a bit away from the gas market and is now on power. Also the fact that we’re still getting a lot of LNG and piped gas is keeping things down,” he added.

Analysts at Aurora Energy said that restrictions from Norway could prompt Britain to call on coal reserve contracts it recently put in place with companies such as Drax and EDF.

The UK system was under-supplied by around 13.3 million cubic meters (mcm) on Tuesday, according to National Grid data.

Peak wind power generation in Britain is forecast at 5.1 gigawatts (GW) on Tuesday and at 5.2 GW on Wednesday, out of a total metered capacity of 19.9 GW.

Maintenance work at Dragon LNG terminal which will last through Wednesday is expected to will limit LNG flows. In addition, maintenance at Norway’s transportation hub Sleipner, and the Vesterled pipeline added to market tightness.

In the European carbon market, the benchmark contract edged up by 0.24 euro to 84.04 euros a tonne.
Source: Reuters (Reporting by Marwa Rashad; Editing by Nina Chestney)