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UK GAS-Prices firm on higher demand, slightly lower Norwegian flows

Friday, 09 April 2021 | 00:00

British wholesale gas prices firmed as cold weather continued to support demand and Norwegian supplies to Britain were slightly lower.

* The day-ahead contract was up 0.85 pence at 53.80 p/therm by 1002 GMT.

* The within-day contract was flat at 54.50 p/therm.

* Lower Norwegian imports to Britain via the Vesterled pipeline and firm carbon prices provided some bullish push to day-ahead prices, analysts at Refinitiv said, but maintained a sideways to bearish view.

* “There are no major fundamental changes compared to yesterday. Strong liquefied natural gas send-out, together with relatively weak gas demand, might weigh on the price today,”

* Local distribution zone consumption, mainly used for heating, would drop by 15 million cubic metres (mcm) on Friday, Refinitiv data showed.

* The temperature forecast had turned slightly milder but was still below normal temperatures until next week, Refinitiv said.

* However, the analysts revised their latest gas-for-power demand forecast for the day-ahead higher by 25 mcm/d, as wind power was expected to drop sharply.

* The market is not as tight compared to Wednesday, as there was is wind power today, but still required withdrawals from storage amid low imports from the continent, a trader said.

* Peak wind power generation will reach 13.8 gigawatts (GW) on Thursday and 12.5 GW on Friday, out of a total metered capacity of nearly 19 GW, Elexon data showed.

* The British gas system was almost balanced, with demand forecast at 256.3 mcm and supply at 256.9 mcm/day, National Grid data showed.

* The May gas price at the Dutch TTF hub was 0.05 euro higher at 19.38 euros per megawatt hour.

* The benchmark Dec-21 EU carbon contract traded 0.27 euro lower at 43.59 euros a tonne.
Source: Reuters (Reporting by Nora Buli in Oslo; Editing by Nina Chestney)

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