Gas prices have started falling due to the unseasonably warm weather this month, it has emerged.
The price of gas for Wednesday delivery fell 0.65 pence to 64.65 pence per therm, while gas for instant delivery fell 0.95 pence to 64.20 pence per therm.
Britain’s gas market was over-supplied by around 30million cubic metres/day (mcm), while demand was estimated at 148.9mcm, according to data from National Grid.
Norwegian gas exports through the Langeled pipeline – which passes through the Sleipner Riser platform in the North Sea – were up by 13mcm as gas was re-routed to Britain from France due to maintenance at Dunkirk, analysts at Thomson Reuters Point Carbon said.
The extra supply meant Britain was receiving more gas than needed as demand remained low amid temperatures that were higher than normal for the time of year and weak gas consumption by power plants.
“With supply up and consumption flat, exports to the continent are set to increase above nominated levels,” the analysts said.
“Injections to medium-range storage are also likely to increase today, mitigating some of the oversupply.”
Further along the curve, gas for delivery in November fell 0.20pence to 67.55pence per therm.
Demand for gas will remain fairly modest in Europe over the coming months, as seasonal forecasts point to a warmer year than last year, said analysts at London-based Energy Aspects.
The news comes as Centrica confirmed it was scrapping plans for a major gas storage facility in the North Sea
Profits from running gas storage in Britain have dropped in recent years due to the shrinking price differential between summer and winter gas prices.
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