Gas prices rise on St Fergus outage!

Discussion on Gas providers etc
User avatar
Professional Shopper
Posts: 734
Joined: Thu Aug 11, 2005 8:17 pm
Location: Durham United Kingdom
Arcade super highscore: 30
Arcade highscore: 30
Gas prices rise on St Fergus outage!

Post by Jamjar »

Hmm, and just in time for the winter price hike! :rolleyes:

LONDON (Reuters) - British wholesale gas prices rose on Thursday morning as an unplanned outage at the St Fergus gas terminal reduced North Sea gas supplies, leaving the system undersupplied.

The unplanned outage at the St Fergus terminal would lead to a production loss of 11.5 million cubic metres (mcm) per day and was expected to last for five days, operator Total said.

Gas prices for delivery on Friday were trading around 56.30 pence per therm at 0750 GMT on Thursday, up half a pence from the previous morning, and within-day delivery gas prices were also up about 0.5 pence to 56.50 pence a therm.

National Grid data showed that gas demand in Britain was expected to be 179.5 mcm on Thursday, almost 27 percent below the seasonal norm.
Despite the low demand, the system was expected to be 3.2 mcm short, with total supplies expected at 176.3 mcm.

"Consumption is forecasted up for day-ahead, which is bullish. The other bullish factor is the lower flow from UKCS (UK Continental Shelf)," analysts at Thomson Reuters Point Carbon said.

Further out on the curve, gas prices for delivery in winter were also up slightly, trading around 65.30 pence per therm.

Analysts have said Britain's gas supplies could be squeezed in winter should a cold snap collide with North Sea supply outages or booming Asian demand sap up supplies of liquefied natural gas (LNG).

"What the loss of LNG does, is make peak supply risks more acute and thus we expect to see prices drift upwards in Q4 and be sustained at higher average prices in 2013 than seen in 2012," Barclays Capital said in a research note on Thursday.

BarCap said it expected the UK will lose 13 bcm of LNG supply in 2012 and another 2 bcm on top of that in 2013, but added that the LNG gap would continue to be met by Norwegian pipeline volumes.

"While the UK gas market should remain relatively well supplied this year, the biggest prevailing risk is weather and for a cold Q4 12 to draw down storage and bring back the risks of winter price spikes," the bank said.

(Reporting by Henning Gloystein; Editing by Alison Birrane)

(c) Copyright Thomson Reuters 2012.
Nothing to look at here :)