British and Dutch wholesale gas prices continued their downward trend on Friday morning amid milder weather forecasts, stronger wind power output and ahead of the Christmas period in Europe.

The British day-ahead gas contract was down 24.00 pence at 170.00 pence per therm by 0917 GMT, while the price for weekend delivery was 14.00 pence lower at 169.00 p/therm.

Weather forecasts show temperatures remaining above seasonal norm into the January, reducing gas demand for heating, while more liquefied natural gas cargoes were on their way to Europe.

Peak wind generation in Britain is forecast to rise to 13.8 gigawatts (GW) on Saturday from 11.6 GW on Friday, out of total metered capacity of around 22 GW, Elexon data showed.

A rise in wind output typically reduces demand for gas from power plants.

Further out on the curve, the British front-month contract TRGBNBPMc1 was down 14.50 pence at 212.00 pence per therm, while the equivalent contract in the Dutch TTF market TRNLTTFMc1 was down by 5.65 euros at 85.5 euros per megawatt hour (MWh).

The Dutch TTF front-month contract, a benchmark of European gas market, has fallen by some 36% since the middle of December, and is more than three times lower from its peak in August.

European gas prices, driven down by healthy gas storage levels, milder weather and lower industrial demand, were still above the levels seen before Russia’s invasion of Ukraine in February.

Russia’s natural gas output is expected to fall by up to a fifth this year as exports to Europe have plunged.
Source: Reuters (Reporting by Nerijus Adomaitis in Oslo, editing by Nina Chestney)