European gas prices move upward on supply concerns, lower Norwegian exports

European and British wholesale gas prices rose on Wednesday

  

LONDON- European and British wholesale gas prices rose on Wednesday morning on concerns over supply with low stock levels and as outages in Norway curbed exports.

* The British gas contract for immediate delivery jumped 37.00 pence to 2.62 pounds per therm by 1058 GMT, with the day ahead contract rising 18.70 pence to 2.595 pounds per therm.

* The benchmark Dutch front-month contract was up 7.47 euros at 102.47 euros/MWh.

* Traders said uncertainty over Russian supply to Europe with continued weak flows is a major concern, while outages in Norway and expectations of colder weather are all driving prices higher.

* Total Norwegian export nominations were 23 million cubic meters/day (mcm/d) down at 325mcm/d compared to the previous day, Refinitiv Eikon data showed, due to unplanned outage at the Troll gas field.

* " A Current large production outage at Troll field is providing a clear bullish signal on the supply side and despite other supply flows remaining roughly sideways we expect prompt prices to rise again on the tighter market today," Refinitiv analysts said.

* A European trader said the market is also concerned over Gazprom's ability to increase flows to Northwest Europe, given the low stock in Europe.

* "Combine that with delays at EDF's nuclear plants and the 4 gigawatt (GW) nuke plants capacity Germany is mothballing this month and you have a recipe for a perfect storm," he added. 

* Lower nuclear power plant output can often lead to higher demand for gas from gas-fired power plants as they are ramped up to make up for the lost capacity.

* Russian natural gas deliveries to Germany through the Yamal-Europe pipeline have been largely stable in the early hours of Wednesday, data from German network operator Gascade showed. 

* The European benchmark December 2021 EUA contract CFI2Zc1 was up 3.79 euros at 88.79 euros a tonne having earlier touched a record high of 89.37 euros/tonne.

(Reporting by Marwa Rashad; Editing by Susanna Twidale) ((marwa.rashad@thomsonreuters.com; +447823669044; Reuters Messaging: marwa.rashad.thomsonreuters.com@reuters.net; Twitter: https://twitter.com/marwastweets))


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