EUROPE GAS-Prices stretch records on energy rally, weak wind, cold
October 6 (Reuters) – Wholesale gas prices in the Netherlands and the UK hit record highs on Wednesday morning, in line with recovering energy markets, and as forecasts for lower wind and cooler weather raises demand and supply remains scarce.
* The November gas price at the Dutch hub TTF, a European benchmark, rose by 25.60 euros to 143.10 euros per megawatt hour at 08:39 GMT. It was previously trading at a record 155.00 euros per megawatt hour.
* The UK day-ahead contract was up 0.61 pounds to 3.40 pounds per therm, and also a new record.
* “It’s amazing what we are watching. Utter madness,” said one gas trader.
* Electricity markets were leading the way, with German baseload for Thursday delivery reaching 400 euros per megawatt hour earlier Wednesday, he added.
* German wind power supply will plunge 13.5 gigawatts (GW) to an average of just 2 GW on Thursday, according to analysts at Refinitiv.
* In the UK, peak wind generation will drop from 12.5 GW on Wednesday to 7.6 GW on Thursday, according to data from Elexon.
* “A big theme for gas is that we might need withdrawals next week due to the colder weather… but of course there is no justification for these moves,” the trader said.
* “Tomorrow through Sunday it will be mostly sunny and dry with near normal temperatures. The first half of next week will be cloudier and cooler with showers. Temperatures will be below normal,” said Refinitiv meteorologist Georg Mueller.
* Storage levels in the UK were 100% full on Wednesday, according to data from Gas Infrastructure Europe.
* European gas prices have also been supported by lingering concerns over scarcity of supply, analysts at Engie Energyscan said.
* Pipeline deliveries from Russia have declined since the summer, as Asian liquefied natural gas (LNG) spot prices hit a record high of nearly $ 40 per million British thermal units (mmBtu) Tuesday.
* The EU benchmark carbon contract of December 21 was down from 2.71 euros to 62.01 euros per tonne.
* The UK benchmark December 21 carbon contract was down 0.90 pounds to 68.50 pounds per tonne. (Reporting by Nora Buli in Oslo; Editing by Nina Chestney)