EUROPE GAS: U.K. Spot Posts Weekly Climb Amid Stronger Demand

Updated on

Natgas for immediate delivery has 1st w/w advance in 3 in U.K., Europe’s most-traded mkt amid higher-than-normal demand and planned start of yearly maintenance at supply facilities next wk.

  • Within-day gas gains 1.5% on NBP hub to 43.60 p/therm by 2:59pm in London; up 3% w/w, down 5.2% m/m: broker data
  • Day-ahead price rises 1.4% to 43.75 p/therm: broker data
  • Avg temperature in U.K. fcast ~3C below 10-year avg Friday before rising to 1C above norm next wk: WSI data
  • U.K. industrial, commercial, residential gas consumption for Friday revised up by ~2.5 mcm/d before declining next wk: Bloomberg model
  • System undersupplied vs balanced earlier Friday: National Grid
  • Day-ahead price supported by start of maintenance on North Sea fields next week: Wingas U.K. in e-mailed note
  • July contract rises 0.3% to 41.96 p/therm on ICE Futures Europe; winter price gains 0.4% to 48.15 p/therm
  • Dutch gas for next month loses 0.4% on TTF hub to EU20.50/MWh; comparable contract on NetConnect Germany falls 0.8% to EU20.68/MWh: broker data

  • DEMAND AND FLOWS
    • Closing linepack 335.2 mcm vs 342 mcm opening: National Grid data at 3:03pm London time
    • U.K. industrial, commercial, residential gas consumption for Friday fcast at 90.5 mcm/d, up from previous est. 88 mcm/d; predicted to ease to 78 mcm/d next wk: Bloomberg model
    • Demand including exports, power generation fcast at 218 mcm Friday vs seasonal norm 168 mcm: National Grid
    • Total flows into U.K. at 212 mcm/d vs 10-day avg 208 mcm/d: grid data
    • Norwegian flows to U.K. at 41 mcm/d vs 10-day avg 44 mcm/d: Gassco data
    • U.K. exports to Belgium nominated at 34 mcm/d, compares w/ 36.5 mcm/d Thursday: Interconnector
    • Gas supplying 31% of U.K. power; coal share at 18%, nuclear at 24%, wind at 13%: grid data
    • LNG send-outs at 63.6 mcm/d vs 10-day avg 52.8 mcm/d: grid
    • Tanker Umm Slal due at U.K.’s South Hook Friday
    • “LNG send-outs from South Hook continue to be the main source of supply for the NBP, with supplies of close to 60mcm expected from the site”: Marcel Boonaert, head of trading at Wingas U.K., in note
  • WEATHER
    • Temperatures in U.K. fcast at 11.7C for rest of Friday vs 10-yr avg 14.9C, next wk rising to 14.7C vs 10-yr avg 13.8C: WSI data using ECMWF model at 7:52am London time.
    • EUROPE WEATHER: Temperatures Seen Dipping Below Norm Next Week
  • OUTAGES
    • SSE Extends Aldbrough U.K. Deliverability Outage to June 1
    • Gassco Says Kvitebjoern Gas Flows Cut by 6.6 Mcm/D Friday
    • Gassco says annual maintenance at unspecified field to cut flows by 65 mcm/d May 19-June 28
    • Gassco says Kollsnes plant to have yearly maintenance May 30-June 9
    • Conoco’s J-Block to have scheduled maintenance June 1-24
    • Teesside Gas Processing Plant to have annual maintenance June 1-2; June 2-23; June 23-24
    • Works to cut power usage at Ormen Lange gas processing plant May 19-June 27: Shell
  • MARKET NEWS
    • Dutch Court Rejects Plea for Reduced Groningen Output
    • Gazprom Warns of $29B Debt as Ukraine Seeks U.S. Arms
  • LNG
    • NE Asia ’15 Forecast Raised to $7.8/MMBtu: Energy Aspects
    • Angola LNG: First Cargoes to Leave in 1Q After Restart
    • Engie Wants Acquisition for Hydro, LNG in Colombia
    • U.S. LNG Exports to Reach 8 Bcf/D by 2020: Bentek
    • Yamal LNG on Track to Get Funding by Year-End: Total

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