Dutch and British wholesale gas prices edged lower on Thursday morning as weak demand helped to offset concern over strikes at some Australian liquefied natural gas (LNG) facilities.

The Dutch October contract was down by 1.48 euros at 36 euros per megawatt hour by 0833 GMT while the day-ahead price was down 0.77 euros at 36.43 euros/MWh, LSEG data showed.

The British October contract slipped by 2.25 pence to 92 pence per therm.

Workers at Chevron’s Gorgon and Wheatstone LNG facilities plan to escalate industrial action that began last Friday to anything from a total strike to hours-long work stoppages, their union said.

The impact of this on Dutch and EU prices, however, has been limited.

The market is likely to watch developments closely, but the impact is not expected to be significant, analysts at consultancy Auxilione said in a market note on Thursday.

Australia is not a major supplier of LNG to Europe and Britain, but gas supply could be affected by the strike if fewer Australian LNG cargoes go to Asia. That would increase competition for other sources of LNG and drive up costs.

Meanwhile, warm weather and strong winds were curbing gas demand in Northwest Europe, said LSEG gas analyst Tomasz Marcin Kowalski.

“We have a forecast of lower … consumption on the day-ahead with the arrival of warmer weather and stronger winds over NWE, which is expected to reduce consumption by a total of 225 gigawatt hours per day,” he said.

Europe’s high gas storage levels also remain a buffer to supply, with storage sites 93.86% full, latest data from Gas Infrastructure Europe showed.

In the European carbon market, the benchmark contract CFI2Zc1 was down 0.29 euros at 82.72 euros a tonne.
Source: Reuters (Reporting by Susanna Twidale, Editing by David Goodman)