British and Dutch wholesale gas prices rose on Wednesday as colder weather forecast for next week is expected to increase demand for heating, while ample supplies limited further gains.
The benchmark front-month contract at the Dutch TTF hub rose 1 euro to 53.70 euros per megawatt hour (MWh) by 0934 GMT, Refinitiv Eikon data showed.
The British within-day contract rose 3 pence to 135 pence per therm, while the contract for March TRGBNBPMc1 added 5.1 pence to trade at 134.50 p/therm.
Benchmark prices touched their lowest since September 2021 earlier this week as less cold weather reduced demand for heating.
“Downward revisions in temperature forecasts for the end of February overnight could provide some support again to European spot and near-curve gas prices today.
“But the comfortable supply picture (with) EU gas stocks are still 65.7% full (and) 20 percentage points above the 5-year average should continue to keep a lid on the prompt,” analysts at Engie’s EnergyScan said in a note.
Temperatures in the United Kingdom and North West Europe are expected to be cooler next week, dipping below normal by the end of the week, said Refinitiv gas analyst Marina Tsygankova.
UK peak wind generation is forecast at 12.99 gigawatts (GW) on Wednesday, but will rise to around 15.85 GW on Thursday, out of a total metered capacity of 22 GW, Elexon data showed. Higher wind output typically reduces demand for gas from power plants.
Supplies remain stable, with Norwegian gas nominations to Europe little changed at 330 million cubic metres (mcm) per day.
Eastbound gas flows through the Yamal-Europe pipeline to Poland from Germany were steady, while Russian supplies to Europe via Ukraine rose.
Russia’s Gazprom will send 35.3 million cubic metres (mcm) of gas to Europe via Ukraine on Wednesday, the highest since Jan. 16, but still be less than levels above 40 mcm in the second half of 2022 and early January.
German utility RWE’s received its first cargo of liquefied natural gas (LNG) at Brunsbuettel port from Abu Dhabi National Oil Company (ADNOC) on Wednesday. The gas will be fed into onshore pipelines from the end of this month, it added.
German Chancellor Olaf Scholz said that gas connections between Germany and Belgium will be expanded to provide not only for domestic use but for neighbours as well.
Meanwhile, Britain’s auction to ensure sufficient electricity capacity for 2023/24 cleared at 60 pounds ($73.07) per kilowatt (kW) per year on Tuesday, National Grid said, down from last year’s record high of 75 pounds/kWh/year.
In the European carbon market, the benchmark contract CFI2Zc1 fell 0.9 euro to 91.12 euros a tonne.
Source: Reuters (Reporting by Swati Verma; Editing by Emelia Sithole-Matarise)