British and Dutch wholesale gas prices fell on Monday morning, as demand was capped by milder temperatures and Norwegian exports rose after the end of an unplanned outage.
The benchmark front-month contract at the Dutch TTF hub fell by 1.82 euros to 51.90 euros per megawatt hour (MWh) by 0927 GMT, Refinitiv Eikon data showed, the lowest level in almost four weeks.
The British within-day contract dropped by 8.98 pence to 132.00 pence per therm, while the day-ahead contract TRGBNBPD1 was down 8.50 pence at 130.50 p/therm.
“The market is probably thinking that a potential increase in gas demand for power generation will be offset by the decrease in … demand due to rising temperatures,” said analysts at Engie EnergyScan.
“Moreover, the former is likely to drop from the middle of this week as wind generation is expected to increase,” they added.
UK peak wind generation is forecast at 5.5 gigawatts (GW) on Monday, but will rise to around 11 GW on Tuesday, out of total metered capacity of nearly 22 GW, Elexon data showed.
Higher wind output typically redcues demand for gas from power plants.
After a cold spell last week, temperatures are expected to be well above normal this week, according to Refinitiv Eikon data, both in Britain and north-western Europe.
The end of an unplanned outage at Norway’s Troll gas field and a sharp increase in Norwegian exports also weighed on prices.
Norwegian gas nominations to Britain jumped from 47 million cubic metres (mcm) per day on Sunday to 87 mcm per day on Monday.
“We take a bearish view for the TTF day-ahead contract today supported by the end of Troll outage and as a result an increase in Norwegian supply both to the UK and the Continent,” said Marina Tsygankova, Refinitiv gas analyst.
Eastbound gas flows on the Yamal-Europe pipeline to Poland from Germany and flows of Russian gas via Ukraine were stable on Monday morning, pipeline operators’ data showed.
European gas storage sites are currently around 66% full, the latest data from Gas Infrastructure Europe showed.
In the European carbon market, the benchmark contract CFI2Zc1 fell by 0.83 euros to 92.20 euros a tonne.
Source: Reuters (Reporting by Bozorgmehr Sharafedin; editing by Nina Chestney)