European and British wholesale gas prices mostly eased after an initially bullish start on Friday morning, as a steady stream of U.S. LNG arrivals continues to mitigate lower Russian gas flows.
The British contract for day-ahead delivery was up 0.50 pence at 228.50 pence per therm by 1007 GMT, with weekend prices down 1.00 pence at 226 pence/therm.
In the Dutch TTF gas market, the day-ahead price was down 0.80 euros at 95.70 euros per megawatt hour (MWh).
The benchmark front-month contract opened at a 9-day high of 103 euros/MWh but has since fallen and is down 2 euros at 96 euros/MWh.
Prices initially rose due to cooler weather forecasts, but with sea-borne deliveries of liquefied natural gas (LNG) priced to come to Europe instead of going to Asia, the market is happy at the current levels, a trader said.
“LNG is mitigating the lower Russian flows,” the trader added.
Flows on the Polish section of the Yamal-Europe pipeline bringing Russian gas to Europe remained in reverse at the German border point of Mallnow for an 18th consecutive day, with flows on another pipeline route via Ukraine also consistently low.
Meanwhile, about half of record U.S. LNG volumes shipped in December went to Europe after prices spiked above their Asian LNG.
Temperatures in the UK should adjust higher over the weekend, while the forecast for north-west Europe turned slightly colder suggesting normal levels next week, Refinitiv analysts said in a morning note.
On the supply side, Norwegian flows to the UK were up slightly on Friday.
Meanwhile, the Dutch government on Thursday proposed allowing production from the Groningen gas field to nearly double this year to 7.6 billion cubic meters (bcm) to guarantee security of supplies.
A final decision is only due in April and the announcement should have little direct impact on near-term prices, traders said.
In other markets, the European benchmark December 2022 emission allowance (EUA) contract rose by 0.51 euro to 87.24 euros a tonne.
Source; Reuters (Reporting by Nora Buli in Oslo; editing by Nina Chestney)