Despite continued withdrawals of gas from storage units, UK prompt prices were bearish Wednesday on lower demand, with gas-fired electricity generation lower and exports to the Continent still at low levels, traders said.
Gas for within-day delivery was down 0.70 pence a therm at 48.50 p/th by midday London time Wednesday, while the day-ahead contract came off 0.45 p/th to trade at 48.85 p/th.
"Prices are lower even though the system is still calling on storage to balance. Effectively gas burn and exports to the Continent have reduced and therefore lowered national transmission system exits, which also kept linepack relatively long," a trader said. "It is still cold so local distribution zone demand is relatively high."
With regard to lower gas burn in order to generate electricity in the UK Wednesday, sources said there was some uncertainty surrounding why the Marchwood and Seabank power stations were not running, while still being declared available.
Traders said this was illogical. Plant operator Scottish and Southern Energy declined to comment.
National Grid data showed Wednesday the domestic gas system was 6 million cubic meters long on gas by lunchtime, with supply at 350 million cu m/d and demand at 344 million cu m/d--14 million cu m/d above the seasonal average.
Storage withdrawals from the long-range Rough unit remained at just under 30 million cu m/d Wednesday, while medium-range flows reduced by 7 million cu m/d to 4 million cu m/d as Hornsea withdrawals ended and Aldbrough flowed at a reduced rate of 4 million cu m/d.
Elsewhere, flows of gas throughout the system continued at the same pace as Tuesday's session, with the exception of Bacton Seal which returned to 15 million cu m/d after an unplanned outage at the Elgin Franklin gas field restricted flows of gas through the pipeline in the previous session.
The contribution of LNG to the system also remained constant at 55 million cu m/d Wednesday, with 35 million cu m/d coming from the South Hook LNG terminal and 15 million cu m/d from Isle of Grain.
The LNG system will be boosted further as local port data also showed South Hook received the Al Ghuwairiya LNG cargo on Tuesday and the Bu Samra is expected on November 21, both from Qatar. The Al Gharrafa will berth from Trinidad & Tobago at the Dragon LNG terminal on Friday, and the Maersk Meridian tanker is still expected to berth in the UK from the US on Thursday.
Traders were also eying Interconnector flows, which were at a low 15 million cu m/d Wednesday, with some sources expecting flows to switch direction when the Belgian Zeebrugge day-ahead contract starts trading somewhere between 0.50 p/th and 1.50 p/th below the corresponding UK price. Currently the contract is trading 0.75 p/th below the UK.
On the curve prices came off a touch on some technical selling action other commodities being pulled lower and a weaker Euro impacting Continental appetite for UK gas, traders said.
Gas for December delivery was changing hands around 0.20 p/th lower than Tuesday's close at 48.20 p/th Wednesday, while the front-quarter was down 0.25 p/th at 49.50 p/th and the Summer 2011 contract was unchanged at 47.50 p/th.
Gas for within-day delivery was down 0.70 pence a therm at 48.50 p/th by midday London time Wednesday, while the day-ahead contract came off 0.45 p/th to trade at 48.85 p/th.
"Prices are lower even though the system is still calling on storage to balance. Effectively gas burn and exports to the Continent have reduced and therefore lowered national transmission system exits, which also kept linepack relatively long," a trader said. "It is still cold so local distribution zone demand is relatively high."
With regard to lower gas burn in order to generate electricity in the UK Wednesday, sources said there was some uncertainty surrounding why the Marchwood and Seabank power stations were not running, while still being declared available.
Traders said this was illogical. Plant operator Scottish and Southern Energy declined to comment.
National Grid data showed Wednesday the domestic gas system was 6 million cubic meters long on gas by lunchtime, with supply at 350 million cu m/d and demand at 344 million cu m/d--14 million cu m/d above the seasonal average.
Storage withdrawals from the long-range Rough unit remained at just under 30 million cu m/d Wednesday, while medium-range flows reduced by 7 million cu m/d to 4 million cu m/d as Hornsea withdrawals ended and Aldbrough flowed at a reduced rate of 4 million cu m/d.
Elsewhere, flows of gas throughout the system continued at the same pace as Tuesday's session, with the exception of Bacton Seal which returned to 15 million cu m/d after an unplanned outage at the Elgin Franklin gas field restricted flows of gas through the pipeline in the previous session.
The contribution of LNG to the system also remained constant at 55 million cu m/d Wednesday, with 35 million cu m/d coming from the South Hook LNG terminal and 15 million cu m/d from Isle of Grain.
The LNG system will be boosted further as local port data also showed South Hook received the Al Ghuwairiya LNG cargo on Tuesday and the Bu Samra is expected on November 21, both from Qatar. The Al Gharrafa will berth from Trinidad & Tobago at the Dragon LNG terminal on Friday, and the Maersk Meridian tanker is still expected to berth in the UK from the US on Thursday.
Traders were also eying Interconnector flows, which were at a low 15 million cu m/d Wednesday, with some sources expecting flows to switch direction when the Belgian Zeebrugge day-ahead contract starts trading somewhere between 0.50 p/th and 1.50 p/th below the corresponding UK price. Currently the contract is trading 0.75 p/th below the UK.
On the curve prices came off a touch on some technical selling action other commodities being pulled lower and a weaker Euro impacting Continental appetite for UK gas, traders said.
Gas for December delivery was changing hands around 0.20 p/th lower than Tuesday's close at 48.20 p/th Wednesday, while the front-quarter was down 0.25 p/th at 49.50 p/th and the Summer 2011 contract was unchanged at 47.50 p/th.
