UK gas prices boosted by weather forecast, LNG tanker bypass
British prompt gas prices rose on Friday morning, snapping three straight days of losses, as cooler weather forecast for next week lifted demand expectations and a liquefied natural gas (LNG) tanker headed to North America instead of the UK, Reuters reports.
Gas for immediate delivery rose 1.75 pence to 67.25 pence a therm at 0845 GMT due to a combination of factors including a tight supply-demand balance, lower temperatures from Sunday and the expected start of maintenance at Apache's North Sea Beryl Alpha platform in the current trading session.
Work at Beryl Alpha will shave 1.5 million cubic meters/day (mcm/day) of supplies from the UK's transmission system.
A forecast drop in temperatures from Sunday to 13 degrees Celsius extending into next week led traders to raise gas demand estimates by 20 mcm/day on the back of greater gas-fired heating demand.
Britain has received no LNG deliveries since Oct. 1, and no tankers are currently expected at UK terminals, partly due to recent maintenance at two of the world's biggest liquefaction plants in Qatar, according to port data.
The Qatari vessel Al Mafyar, which has a track record of unloading at the UK's South Hook terminal, disappointed expectations of a delivery by signalling North America as its intended destination.
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.
Norway, Britain's other major gas supplier, on Friday warned that major maintenance programmes would hit output in the last three months of the year, potentially disrupting flows to the UK.
However, it said repairs would be split equally between Norway and its international operations, meaning supply losses to the UK may be less than expected.
Britain's gas market was undersupplied by about 4 mcm/day, with demand pegged at 246.9 mcm/day.
Month-ahead gas prices rose 1.2 pence to 67.30 pence.
Further forward, the benchmark summer 2013 gas price rose about 0.20 pence to 62.15 pence.
In Britain's power market prices for day-ahead delivery climbed 6.25 pounds to 56.75 pounds per megawatt-hour (MWh) as gas market sentiment fed through to power.
A total of 2,870 MW of nuclear capacity was offline Friday morning due to outages at Magnox's Wylfa 1 unit, EDF Energy's Hinkley Point B-7, Dungeness B21 and its Heysham 1-1 and 1-2 reactors.
