A racehorse is taken out for an early morning ride in
Middleham, northern England. REUTERS/Nigel Roddis
British day-ahead gas prices hit an 11-month high as
sub-zero temperatures drove up demand, supply was disrupted
from domestic fields and futures firmed along with oil amid a
violent turn in the Algerian hostage crisis.
By 1430 GMT Thursday, gas for Friday delivery was at 72.70
pence per therm, up 3.65 pence or 5.3 percent from
Wednesday's close. It earlier hit an intraday high of 74
Britain's Met office forecast heavy snow for much of the UK
in the next 24 hours, putting further pressure on the UK's
gas system following sub-zero temperatures overnight.
The National Grid forecast demand for day-ahead gas at almost
400 million cubic metres (mcm), which would be the biggest
requirement for gas so far this winter.
Demand for gas was around 385 mcm on Thursday, about a
quarter higher than the seasonal norm.
"It was easily the coldest night of the winter so far in many
parts of Britain, (and) the biggest storage sites are
withdrawing as much as gas as they can," one trader said.
The prompt contract also made big gains, trading at 72.50
pence, up 2.90 pence or almost 4.2 percent. The contract
earlier peaked at 75 pence for the day, spiking 8.5 percent.
Gas piped from the UK gas fields dropped to 121 mcm early on
Thursday from 129 mcm on Wednesday morning, but by 1445 GMT
had recovered to 126 mcm, National Grid data showed.
Supply from the IUK pipeline increased on Thursday morning to
34 mcm from 18 mcm on Wednesday, which helped to meet demand,
analysts at Reuters Point Carbon said.
Britain is likely to remain gripped by icy weather well into
next week, the Met Office said.
Meanwhile the front-season NBP contract was supported by
reports that many people were killed after Algerian armed
forces tried to bring an end to a hostage crisis at a remote
British gas for summer 2013 delivery traded at 62.40 pence,
up 0.35 pence on Wednesday's close, while Brent crude oil
traded at $110.79/barrel, up a dollar from where it settled
The crisis has raised fears of future disruption to supplies
from the North African country, which pipes gas to southern
Europe and is an exporter of liquefied natural gas to
countries including Britain.
If Algeria's In Amenas field experiences a lengthy shutdown,
the impact on supply would be small for most of Europe as
Russian gas would make up the difference, said Thierry Bros,
an analyst with Societe Generale.
"(But) it could be more challenging for Spain as the country
is less well interconnected with the rest of Europe," Bros
said in an emailed note.
In the electricity market, baseload day-ahead power traded at
53.92 pounds per megawatt-hour, up 53 pence from Wednesday's