London — British and Dutch wholesale gas prices edged down on Friday morning amid higher wind output forecasts for next week and lower-than-expected consumption in northwest Europe.
The Dutch front-month contract was flat at 187 euros per megwatt hour (MWh) by 0810 GMT, while the November contract was down 2.25 euros at 202 euros/MWh.
The British day-ahead contract was down 5 pence at 245 pence per therm while the October contract was flat at 290 p/therm.
Colder weather across northwest Europe is expected next week but forecasts towards the end of the week have been revised slightly higher.
In the UK, residential consumption is forecast to increase above normal levels but consumption in Europe is still seen below the seasonal norm, Refinitiv Eikon data showed.
In Britain, wind output is expected to increase next week, which could lower demand for gas from power plants.
Peak wind generation is forecast at 4.1 gigawatts (GW) on Friday and 5.5 GW the next day, out of total metered capacity of around 20 GW, Elexon data showed.
“An upward revision in temperature forecasts for the end of next week, combined with an expected jump in wind power generation across Europe, may continue to weigh on prompt prices this morning, although losses could be limited due to risks surrounding remaining Russian gas flows through Ukraine,” said analysts at Engie EnergyScan.
Eyes are also on news related to market intervention and regulatory developments ahead of the next EU Energy Council meeting on Sept. 30, they added.
The European Commission is working on more measures to tame sky-high gas prices and support energy firms facing a liquidity crunch, and may lay out its plans to EU countries next week.
While negotiations are happening, the Commission intends to publish an update on Sept. 28 on further measures it is exploring, EU officials said.
This plan will not include legal proposals, but cover options the EU could use to tackle high gas prices – which the Commission has said could include launching an alternative benchmark gas price to the Dutch Title Transfer Facility (TTF).
Meanwhile, European Union’s securities watchdog proposed a temporary brake on gas and electricity derivatives when prices spike to improve the overall functioning of the energy market.
In the European carbon market, the benchmark contract was down 1.01 euros at 69.41 euros a tonne.
Reporting by Nina Chestney – Reuters
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