Colder weather is set to hit major European markets over the coming week, boosting heating-related demand and supporting gas prices. A cold snap is forecast to hit much of the UK over the next few days. This follows relatively mild temperatures and weak seasonal consumption, with the UK’s gas demand forecast to be around 3% below seasonal norms on Wednesday.
Although the cold snap is expected to be followed by comparatively mild weather next week, the colder temperatures and snow that are forecast will support a rise in prices and increase the risk of price volatility. The NBP day-ahead was around 53 p/th on Tuesday, an increase of more than 2 p/th from Monday. With restricted maximum daily withdrawals and relatively low volumes of gas in stock at the UK’s Rough storage facility, flows from the continent will be especially important to the UK’s short-term supply balance.
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