UK gas prices fall on rising supplies
British prompt gas prices fell early on Monday on the back of healthy supplies from Norway and heavy imports from mainland Europe, Reuters reports.
Gas for Tuesday delivery fell 0.70 pence to 67.30 pence a therm at 0945 GMT due to an oversupplied transmission system thanks partly to rising output from liquefied natural gas (LNG) terminals.
The Isle of Grain terminal was flowing 9 million cubic metres/day while South Hook contributed a further 5 mcm/day, data from National Grid showed.
Higher send-out rates raised expectations of an LNG cargo arrival after an almost month-long hiatus in deliveries.
"No new vessels have been reported arriving by the port authorities today and no vessels currently have South Hook (or any other UK terminal) as a reported destination," analysts at Thomson Reuters Point Carbon said.
"However, the Shagra that has been to South Hook several times this year is currently heading to the Red Sea and could potentially be going to South Hook," Point Carbon said.
Analysts and traders expect higher numbers of LNG tanker deliveries in November after Qatargas said it had restarted production lines 4 and 5 after planned works.
Imports via Norway's Langeled pipeline hovered above 60 mcm/day. The premium of UK gas prices over competing gas hubs in Europe further incentivised continental shippers to send gas to Britain given the availability of higher prices.
Imports from the Netherlands via the BBL pipeline were at 23 mcm/day while imports from Belgium steadied at a high rate of just under 25 mcm/day, flow data shows.
Britain's Met Office forecast colder-than-normal temperatures in the first part of its six to 15-day forecast.
"Temperatures often below normal at first, but perhaps recovering to nearer normal values as we approach mid November," it said.
Britain's gas market was oversupplied by about 3 mcm/day, with demand estimated at 264.7 mcm/day
Month-ahead gas prices fell 0.30 pence to 67.25 pence.
Further forward, the benchmark summer 2013 gas price also fell 0.30 to trade at 61.90 pence.
In Britain's power market prices for day-ahead delivery traded at 50.50 pounds per megawatt-hour (MWh) as gas market sentiment weighed on electricity prices.
A total of 3,350 MW of nuclear capacity was offline Monday morning due to several outages including one this morning at EDF Energy's Hinkley Point B-8 nuclear plant.