Gas prices moved down on Friday as mild weather was forecast today and wind levels were also expected to ramp up, reducing the need for CCGT generation. The UK gas system was oversupplied as UKCS production and Norwegian flows increased, although a weaker Pound limited some of the losses on the far-curve.
Norwegian flows were impacted by unplanned outages yesterday, while the return of the Rough storage facility has been delayed further, pushing gas contracts higher. The UK gas system was short on the back of this drop in supply, while a rise in coal prices supported contracts further along the curve.
Unplanned outages in Norway offered support to the near gas curve yesterday despite weaker demand levels as a result of milder weather. Norwegian exports to Europe fell to 320mcm during the session compared to an average of 349mcm last week. Movement was minimal on the far-curve with little support provided by the oil market.
Gas contracts inched higher Tuesday morning but another upward revision in temperatures helped towards losses in the afternoon. The UK gas system was long following an increase in UKCS production, while wind levels are also expected to improve next week, weighing on the prompt. Further out, contracts were generally stable with little support coming from coal and oil markets.
Gas prices moved down yesterday on the back of the mild weather forecast for the rest of February. The expected delivery of an LNG shipment at the Isle of Grain also helped to weigh on prices, with weaker oil and coal markets an additional factor.