Dutch and British wholesale gas prices fell on Monday morning amid milder temperatures and stronger wind speeds.

The Dutch month-ahead contract was down by 1.40 euros to 27.00 euros per megawatt hour (MWh) by 0902 GMT, while the March contract declined by 1.27 euros to 27.13 euros/MWh, according to LSEG data.

In the British market, the day-ahead price fell by 3.60 pence to 65.00 pence per therm.

Milder temperatures in Britain and north-west Europe, coupled with stronger wind speeds, have reduced demand.

“The sharp upward revision in temperature forecasts for the end of January and the beginning of February in Europe should resume the bearish trend today,” said analysts at Engie EnergyScan.

In Britain, peak wind generation is forecast at 19.8 gigawatts (GW) on Monday and 19.5 GW on Tuesday, out of total metered capacity of around 23 GW, Elexon data showed.

Britain’s rail network was disrupted, flights were cancelled and thousands of homes were left without power on Monday after the country was battered by Storm Isha overnight.

Concern around the security of energy infrastructure has resurfaced after a drone attack on Novatek’s Baltic Sea fuel export and processing complex Ust-Luga on Sunday.

There was no impact on the gas market as the export terminal is for oil products.

On the supply side, pipeline gas flows from the UK Continental Shelf and Norway are roughly stable, while liquefied natural gas send-out is slightly lower than Friday.

Analysts at Bernstein Energy said European storage levels could fall to around 57% full by the end of this winter from around 80% full currently.

In the UK power market, six nuclear reactors are offline with a total capacity of around 3.5 GW.

In the European carbon market, the benchmark contract fell by 1.59 euros to 62.06 euros per metric ton.
Source: Reuters (Reporting by Nina Chestney)