UK gas prices climb above 200 p / therm amid new supply issues

By 1056 GMT, the wholesale price of gas for winter delivery TRGBNBPSH2 rose 20.2% to 218.40 pence per therm.

This year, UK wholesale gas benchmarks have more than tripled due to several factors including low inventory levels, high demand in Asia, making it more difficult to attract LNG cargoes and problems maintenance on key infrastructures and a drop in flows to Europe from the main Russian producer. .

Record gas prices and well below five-year average storage stocks reflect the extremely tight European gas market as we enter the winter gas season, gas analysts at Refinitiv said.

The so-called “winter gas season” begins on October 1 and continues until the end of March. This is a period when the demand for heating is generally higher due to the colder temperatures.

“For the winter of 2021, mild weather alone may not be enough to balance this market. We conclude that additional supply is a key factor in lowering prices this winter,” analysts said.

A drop in Russian supplies to Europe on Tuesday also added to supply concerns.

Russian supplies via the Yamal-Europe pipeline fell by more than half compared to Monday, the Interfax news agency reported citing data from network operator Gascade.

Other prices also rose on Monday, with the UK day-ahead contract TRGBNBPD1 leaping 4.75 pence to 178.00 p / therm in early morning trading.

The October gas price at the Dutch TTF hub, a European benchmark, TRNLTTFMc1 was up 7.47 euros, or 9.7%, to 84.00 euros per megawatt hour (MWh).

Prices were also supported by cooler average temperatures in Britain, which are expected to drop below normal seasonal levels on Tuesday and Wednesday, according to data from Refinitiv Eikon, and forecasts of lower temperatures in the northwest of Europe by the end of the week. NG / GB

WATCH-Reuters on soaring gas prices in Europe

GRAPHIC-At the dawn of the winter season in Europe, gas storage reaches its lowest level in 10 years

FACTBOX-Europe grapples with soaring electricity and gas prices

(Reporting by Marwa Rashad in London and Nora Buli in Oslo; Editing by Nina Chestney)

(([email protected]; +447823669044; Reuters messaging: [email protected]))

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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