Support for European prices unlikely to last

By Catriona Scott 5 April 2017
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European hub prices have received support recently from lower levels of supply and increased demand in some markets, but this trend is not set to last. The NBP day-ahead rose over the past week to reach 40.90 p/th on Tuesday. The TTF day-ahead made similar gains, rising to 40.21 p/th on Tuesday from 37.98 p/th late last week. Support from higher demand saw Germany’s NCG day-ahead rise to 41.28 p/th. Demand picked up in the regional market and neighbouring areas, in part because of a dip in temperatures and support for heating-related gas use.

An unexpected outage in Norway, which started late on Monday, has lent support to prices. The outage at the Kvitebjørn gas field has hit supplies to the UK, supporting gains at the NBP. However, the field is scheduled to come back onstream within the coming week, which will put supply-side pressure on prices. While demand is forecast to be above seasonal norms in the UK on Wednesday, warmer temperatures are forecast for much of the country over the coming days; combined with stronger supply, this should weigh on the NBP day-ahead.

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