Dutch and British wholesale gas prices inched up on Thursday morning as temperatures and renewables generation are set to dip at the weekend, amid quietening trade ahead of the Easter period.

The benchmark Dutch front-month contract (TRNLTTFMc1) was edged up by 0.24 euro to 35.66 euros per megawatt hour (MWh) by 0758 GMT, while the June contract (TRNLTTFMc2) inched up by 0.26 euro to 35.86 euros/MWh, LSEG data showed.

The British contract for the weekend was 1.75 pence higher at 86.75 pence per therm.

In north-west Europe, average temperatures will continue to decline by another 1.5 degrees Celsius tomorrow but the weekend should see temperatures at an average of 12C, 2-3C above normal levels, LSEG data showed.

The forecast for next week shows a 0.6C rise on average.

Both wind and solar power generation are forecast to be low at the weekend, but set to rise again next week. Lower renewables generation typically increases demand for gas.

Analysts at Engie EnergyScan said that Europe cannot afford to let flexible LNG cargoes leave for Asia, meaning European gas prices should trade at a premium to Asian prices.

“The price trend (today) indicates that this is what is happening,” they said.

European officials have dropped the idea of pushing for a ban on the bloc’s Russian LNG imports in upcoming packages because of resistance from some governments and uncertainty about alternative sources, EU officials said on Wednesday.

Instead, the Commission wants to iron out a new road map to end the bloc’s reliance on Russian energy by 2027. The plan is due to be announced in early May but details are scarce.

In the European carbon market, the benchmark contract (CFI2Zc1) was 0.25 euro lower at 66.72 euros per metric ton.
Source: Reuters