Dutch and British gas prices were little changed on Friday, with improved Norwegian gas flows next week offsetting concerns over future Russian gas supplies and strong Asian competition for liquefied natural gas (LNG).

The benchmark front-month contract at the Dutch TTF hub TRNLTTFMc1 was down by 0.01 euros at 34.92 euros per megawatt hour (MWh) by 0839 GMT, LSEG data showed.

The July contract TRNLTTFMc2 was trading 0.09 euros firmer at 35 euros/MWh.

The TTF day-ahead contract TRNLTTFD1 was 0.15 euros down at 34.95 euros/MWh. In the British market, the day-ahead TGRNBPD1 contract was up 0.5 pence at 84.00 pence per therm.

Current gas prices are factoring in a risk premium that lifts them above where fundamental drivers would suggest, one trader said.

Such fundamentals include gas storage at 70% of capacity, mild weather and Norwegian gas flows of 300 million cubic metres (mcm) per day, the last of which had dropped as low as 178 mcm/day because of maintenance outages over the past ten days.

“Extant risks remain in play from a geopolitical front while OMV supply risk and Russian LNG concerns will continue to loom over markets,” LSEG analyst Wayne Bryan said in a weekly market report.

A ramp-up in Norwegian imports and stronger LNG send-out should lower prices, however, with LSEG forecasting Dutch day-ahead prices to average 33 euros/MWh and their British equivalent at 82 p/th next week.

Gas supply from Russia to Europe via Ukraine remains steady at 42.4 mcm/day.

Meanwhile, extreme temperatures across Asia are driving up liquefied natural gas (LNG) demand in the region, increasing competition for the fuel with European buyers.

In the European carbon market, the benchmark contract CFI2Zc1 rose by 0.37 euros to 75.85 euros a metric ton.
Source: Reuters (Reporting by Nora Buli in Oslo, Editing by David Goodman)