UK gas prices ease after rally as supplies improve

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British gas prices eased on Thursday morning after rallying earlier in the
week on erratic Norwegian supply and strong demand for export to continental
Europe.

Gas for delivery on Thursday traded around 48.55 pence at 1100 GMT, about
0.40 pence lower than the price paid for within-day gas late on Wednesday,
as slightly stronger supply from Norway and healthy flows from liquefied
natural gas terminals helped meet demand.

UK gas prices generally rose for
the first three days of the week, but most prices were softer on Thursday
morning. “It’s probably just been a bit over cooked last couple of days,”
one trader said, adding that the market was waiting to see how much gas is
pumped into Britain during October — the start of the six month winter
period.

October gas contracts traded up half a penny to 46.50 pence ($7.37 per
mmbtu), but prices for Winter 2010 contracts and beyond all fell.

After a bumpy start to the week, supplies via Norway’s Langeled pipeline
were relatively stable overnight and crept up to around 20 million cubic
metres by midday, according to data from National Grid.

Supplies were boosted by Britain’s Rough gas storage facility overnight but
strong flows from both the South Hook and Isle of Grain LNG terminals,
combined with pipeline flows, helped meet demand after Rough stopped pumping
out gas from under the North Sea.

http://af.reuters.com/article/energyOilNews/idAFLDE68T1EU20100930

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