Dutch and British wholesale gas prices posted small gains on Thursday morning as colder and less windy weather increased demand, but overall maintained a tight range as the market continues to monitor developments in the Middle East.
The benchmark front-month contract TRNLTTFMc1 at the Dutch TTF hub was up 0.21 euros at 38.76 euros per megawatt hour (MWh), or $12.42 per mmBtu, by 0839 GMT, LSEG data showed.
The day-ahead contract TRNLTTFD1 was up 0.82 euro at 38.72 euros/MWh.
The British day-ahead price TRGBNBPD1 was 1.50 pence higher at 95.50 pence per therm.
The prospect of below-seasonal temperatures and wind power generation in Britain until early next week provided support to gas contracts, analysts at Northern Gas and Power said in a morning briefing.
Lower German and French temperatures lifted heating demand by over 450 gigawatt hours (GWh) per day for the day-ahead, while in Britain demand was up by 39 million cubic metres (mcm) per day, according to LSEG data.
Peak wind generation in Britain is set to drop from 15.2 gigawatts (GW) on Thursday to 9.7 GW on Friday, according to Elexon data.
However, supply in Europe remains “abundant here and now”, analysts at Energi Danmark said in a morning report, highlighting an increase in Norwegian gas flows following some outages and ongoing exports from Russia via Ukraine.
“The potential of a sudden rebound in case of an Israeli attack on Iran is still present, and the market awaits when this will happen,” they added.
The Middle East has been on edge awaiting Israel’s response to a missile attack from Iran last week that Tehran carried out in retaliation for Israel’s military escalation in Lebanon.
U.S. President Joe Biden and Israeli Prime Minister Benjamin Netanyahu had a “direct and very productive” call on Wednesday, the White House said, while Israeli Defence Minister Yoav Gallant promised an Israeli strike against Iran would be “lethal, precise and surprising”.
In the European carbon market, the benchmark EU carbon permit contract CFI2Zc1 rose 1.82 euro to 63.83 euros per metric ton.
Source: Reuters (Reporting by Nora Buli in Oslo; Editing by Kevin Liffey)