The price of gas in Europe has reversed its initial gains and is now lower than the oil prices.
The Dutch and British wholesale prices of gas reversed gains earlier on Tuesday afternoon. They fell in line with the oil price and offset initial concerns about rising demand due to cooler weather conditions and U.S. liquefied gas supplies.
LSEG data shows that the benchmark front-month contract for the Dutch TTF Hub was down 1.75 euros to 35.40 euros or $11.43/mmBtu by 1502 GMT.
It had reached a high of 37.90 Euros/MWh earlier in the day.
The day-ahead contract on the British market fell 4 pence, to 85.00 p/therm. It had traded as high at 90.75 pence per thermo in the morning.
An investor said that a dip in wind production coincident with a fall in temperatures was supportive.
He added, "I believe the move up to a higher position was overdone."
The trader also added that there was likely some profit-taking going on, and trading volumes were lower in the last three to four sessions.
LSEG data shows that temperatures in Britain and North-West Europe will be below normal through the week.
Elexon data shows that the peak wind power generation is expected to fall from 18.2 gigawatts (GW) on Tuesday to 15.1 GW on Wednesday. This level remains high.
LSEG data show that maintenance at Norwegian infrastructure is continuing to severely curb gas supply. However, exports of gas to continental Europe and Britain remained flat on lower levels at 190 million cubic meters on Tuesday morning.
Analysts warned that the U.S. tropical storm Francine could turn into a major hurricane. This would have a significant impact on oil and gas production, as well as LNG export facilities.
LSEG data shows that feedgas consumption at Cameron LNG in Louisiana has already decreased.
The oil prices have also lost their gains, as has the demand outlook. Concerns about disruptions in supply as operators cut back production in the Gulf of Mexico outweighed concerns about global oversupply.
The benchmark contract on the European carbon markets fell from 65.05 to 1.47 euros per metric ton.
(source: Reuters)
