UK gas prices ease after rally as supplies improve
LONDON, Sept 30 (Reuters) - British gas prices eased on Thursday morning after rallying earlier in the week on erratic Norwegian supply and strong demand for export to continental Europe.
Gas for delivery on Thursday traded around 48.55 pence at 1100 GMT, about 0.40 pence lower than the price paid for within-day gas late on Wednesday, as slightly stronger supply from Norway and healthy flows from liquefied natural gas terminals helped meet demand.
UK gas prices generally rose for the first three days of the week, but most prices were softer on Thursday morning. "It's probably just been a bit over cooked last couple of days," one trader said, adding that the market was waiting to see how much gas is pumped into Britain during October -- the start of the six month winter period.
October gas contracts traded up half a penny to 46.50 pence ($7.37 per mmbtu), but prices for Winter 2010 contracts and beyond all fell.
After a bumpy start to the week, supplies via Norway's Langeled pipeline were relatively stable overnight and crept up to around 20 million cubic metres by midday, according to data from National Grid.
Supplies were boosted by Britain's Rough gas storage facility overnight but strong flows from both the South Hook and Isle of Grain LNG terminals, combined with pipeline flows, helped meet demand after Rough stopped pumping out gas from under the North Sea.
A drop in flows through the Theddlethorpe terminal from around 12 mcm/day to zero on Thursday morning added some support. The terminal and field operator declined to comment.
Another tanker is expected to arrive at the Isle of Grain near London on Thursday. [LNG/TKUK] Supporting demand for export, gas prices in Belgium remained higher than in the UK. [EUNATGASFWD]
Qatar, by far Britain's biggest source of LNG, said on Thursday that it had sold most of the expected output from its latest new production lines which are expected to open over the next few months -- some of which is bound for Europe. [ID:nTOE68T086] [ID:nTOE68S05M] Continued...