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Dutch and British wholesale gas prices fell on Tuesday morning, retreating from a 15-month high in the previous session as mixed temperature forecasts and higher renewable output weighed on the market.
The benchmark front-month contract at the Dutch TTF hub was down 1.18 euro at 52.57 euros per megawatt-hour (MWh), or $15.91/mmBtu, by 1235 GMT, according to LSEG data.
The contract hit an intra-day high of 54.61 euros/MWh on Monday, its highest level since October 2023.
The Dutch April contract was down 2.00 euro at 51.65 euros/MWh.
In Britain, the front-month contract fell 3.77 pence at 127.28 p/therm.
Wind power output was expected to rise in Germany on Wednesday, by 3.9 gigawatts (GW) to 16.2 GW, LSEG data showed.
In Britain, peak wind power output was forecast at 18.6 GW for Wednesday, Elexon data showed.
Analysts at LSEG said temperatures were expected to rise around 2 degrees Celsius in Northwest Europe for Wednesday, but that cooler temperatures towards the end of the week will follow this.
“Temperature forecasts are still limiting the downside as the duration of that cold spell remains uncertain,” said LSEG analyst Ulrich Weber.
Europe’s gas stores are currently 52.65% full, data from Gas Infrastructure Europe showed.
“Colder temperatures are expected for the week ahead, much lower than seasonal normal levels, which is likely to add some further pressure to EU gas stocks,” analysts at consultancy Auxilione said.
One trader attributed the price drop to a media report that Italy is calling on the EU to lower its gas storage requirements.
European countries currently have mandated filling targets for storage sites which help to ensure supplies but are also bullish for prices.
In the European carbon market, the benchmark contract was down 0.33 euros at 80.63 euros a metric ton.
(Reporting By Susanna Twidale; Editing by Tasim Zahid)