EUROPE GAS-Prices rise on EU energy plans, cooler weather forecast

As the 27-member European Union grapples with an energy crisis fuelled by Russia's invasion of Ukraine, European Commission President Ursula von der Leyen said its plans include skimming off revenues from low-cost electricity generators and making fossil fuel firms share windfall profits. "The bullish moves are supported by the no agreement on doing anything to hinder gas for power demand," a European gas trader said.


Reuters | London | Updated: 15-09-2022 14:31 IST | Created: 15-09-2022 14:29 IST
EUROPE GAS-Prices rise on EU energy plans, cooler weather forecast
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British and Dutch gas prices rose on Thursday after the EU said it plans to raise more than 140 billion euros ($140 billion) to shield consumers from soaring energy prices, along with forecasts for cooler weather. The Dutch front-month contract, the European benchmark, was up 21 euros at 237 euros per megawatt hour (MWh) at 0832 GMT, while the contract for next-day delivery rose by 26 euros to 234 EUR/MWh

The British day-ahead contract was up 25 pence at 390 pence per therm, while the October contract rose by 59 pence to 450 p/therm. As the 27-member European Union grapples with an energy crisis fuelled by Russia's invasion of Ukraine, European Commission President Ursula von der Leyen said its plans include skimming off revenues from low-cost electricity generators and making fossil fuel firms share windfall profits.

"The bullish moves are supported by the no agreement on doing anything to hinder gas for power demand," a European gas trader said. "Before that, some utilities dumped some position thinking demand will be lower and they wouldn't use as much gas for power, but now it seems that's not the case. (It is) Open budget to buy what they need," he said.

A colder weather forecast is also supporting prices as some players are getting nervous about not having a moderate winter, the trader added. Refinitiv meteorologist Georg Muller said that the weather on Friday, the weekend and the first two days of next week will be cloudy with frequent showers or rain, with below normal temperatures and high wind speeds.

A cold winter could test Germany's gas supply and any shortage will not be foreseeable until it is too late, the head of the country's energy regulator told a newspaper on Thursday. Peak wind power generation in the UK is forecast at 8.4 gigawatts (GW) on Thursday, rising to 13.1 GW on Friday, out of a total metered capacity of 19.9 GW, Elexon data showed.

Eastbound natural gas flows through the Yamal-Europe pipeline to Poland from Germany fell on Thursday, operator data showed, while the Nord Stream 1 pipeline from Russia to Germany remained shut and flows from Russia to Europe via Ukraine remained steady. In the European carbon market, the benchmark contract was down 1.35 euros at 71.01 euros a tonne.

 

(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)

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