Dutch and British wholesale gas prices rose on Wednesday morning on forecasts for colder weather, raising heating demand, while market players continue to closely monitor geopolitical tensions in Ukraine and the Middle East.

The benchmark front-month contract TRNLTTFMc1 at the Dutch TTF hub was 1.09 euro higher at 36.50 euros per megawatt hour (MWh) by 0823 GMT, while the November contract TRNLTTFMc2 rose by 0.58 euro to 37.27 euros/MWh, LSEG data showed.

In the British market, the front month TRGBNBPMc1 was 0.75 pence higher at 87.00 pence per therm.

The first cold snap this fall is expected to hit Northwest Europe between Sept. 27 and Oct. 1, increasing gas demand for heating,said LSEG analyst Tomasz Marcin Kowalski.

In Britain, the coldest day is forecast for Sept. 28, with average temperatures 4 degrees below the seasonal normal, Kowalski said.

The market is closely monitoring weather conditions in the Gulf of Mexico, consultancy Auxilione said in a morning note,adding that escalations of tensions in the Middle East and on the Ukraine-Russia border continue to inject some volatility into markets.

The latest forecasts for Tropical Storm Helene in the United States signal it will miss most of the producing regions in the western and central Gulf of Mexico as it strengthens into a hurricane on Wednesday and hit the Florida Panhandle late Thursday.

Meanwhile, an intensifying conflict in the Middle East between Iran-backed Hezbollah in Lebanon and Israel, with cross-border rockets launched by both sides, has heightened fears ofa broadening war in the key producing region.

On the bearish side, Norwegian exports rose by 32 million cubic meters per day (mcm/d) on Wednesday morning, LSEG data showed.

European storage levels are currently near 94% of capacity, according to Gas Infrastructure Europe data.

In the European carbon market, the benchmark contract CFI2Zc1 inched up 0.48 euro to 64.35 euros per metric ton.
Source: Reuters (Reporting by Marwa Rashad; Editing by Eileen Soreng)