March 5, 2018 / 10:22 AM / a year ago

UK GAS-Prices plummet as temperatures rise, supplies strengthen

March 5 (Reuters) - Prices for British wholesale gas plummeted on Monday after a week of unusually cold weather had driven contracts to their highest in more than a decade.

A rise in temperatures by some 10 degrees Celsius and higher flows from Norway drove the decline, traders said.

* Day-ahead gas fell by 25 pence, or 32 percent, to 53 pence per therm by 1000 GMT.

* Within-day gas was down 173 pence at 52 p/therm.

* “Τhe temperatures have warmed up quite considerably since the forecasts issued on Friday,” a British gas trader said.

* He added that strong flows from Norway had helped to drive prices back to seasonally normal levels.

* Southern Britain could register average temperatures of 9 degrees Celsius on Monday, rising to 10 degrees on Tuesday, data from Britain’s Met Office showed.

* Gas supply from Norway to Britain on Monday was flowing at 134 million cubic metres (mcm) per day, nearing the pipeline system’s maximum capacity, as maintenance that had cut flows short last week had finished.

* Prompt prices hit their highest in more than 10 years last week after National Grid had warned of a potential gas shortage and a cold snap paralysed much of Britain.

* UK gas demand stood at 311.4 mcm at 0930 GMT, about 15.2 mcm higher than usual for the time of year. The system was oversupplied by 34.4 mcm as flows were expected to reach 345.8 mcm on Monday.

* The April contract fell by 1.45 pence to 46.85 pence/therm.

* Day-ahead gas at the Dutch TTF hub was down 8.75 euros at 19.75 euros per megawatt-hour.

* The benchmark Dec-18 EU carbon contract was down 0.02 euro at 10.12 euros a tonne.

* Thomson Reuters analyst view: here (Reporting by Lefteris Karagiannopoulos in Oslo; Editing by Dale Hudson)

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