"Warmer weather and lower nominated flows to the Continent have both reduced demand over the past few days. Flows from Norwegian pipelines and LNG have remained consistent to yesterday, cumulatively bringing almost 100 million cubic meters to the system," a trader said.
"Day-ahead prices have rebounded from the large sell-off in the afternoon and forecasts may be tight for next week," the trader added. Sources added it was also revealed late on that prompt prices were partly firmer in Thursday's session on the back of rumors of a leak in Norwegian processing plant, Kollsnes. Gas operator, Gassco, then quickly quashed any such rumors, sparking the sell-off. Many traders were uncertain about the day's fundamentals and initially blamed the weaker afternoon prices on a revised weather forecast.
Heading into the weekend temperatures in London are forecast to remain 3 degrees Celsius above the seasonal average in a range of 12-19 degrees Celsius, the latest Customweather data showed, with the climate falling as low as 3 degrees Celsius below normal by next Wednesday. The UK-Belgium Interconnector was flowing at 45 million cu m/d Friday, down from record levels of 60 million cu m/s all this week, its website showed.
National Grid data showed the system became 5 million cu m/d long on gas at midday, with supply forecast at 258 million cu m/d against demand of 253 million cu m/d--just 3 million cu m/d below the seasonal average. Flows of gas from Norway through the Langeled held at 60 million cu m/d Friday morning, and Teesside also returned to 12-14 million cu m/d Friday after technical issues reduced flows to 6 million cu m/d earlier in the week. LNG from South Hook fell slightly, but continued flowing at around 25 million cu m/d, and Isle of Grain LNG was at zero. However, despite the longer system LNG is expected to flow at some capacity as the grid makes space for a fresh influx of LNG from Qatar in coming days.
The long system meant the Aldbrough medium range storage unit was no longer required after being used to balance out the system this week, taking an edge off the price premium. On the curve, traders said prices simply reversed the previous day's losses.
The front-month was changing hands at 46.55 p/th by midday, up 0.30 p/th, while the first quarter of 2011 was up 0.25 p/th to 50 p/th. The front-season also gained a quarter of a penny to trade at 48.50 p/th around lunchtime.
China Chemical Weekly: http://news.chemnet.com/en/detail-1411716.html
