Prompt prices on the UK's NBP gas trading hub fell Friday morning as the system saw a large supply surplus and warm, sunny weather expected for the weekend should further cut heating demand.
"The system was the longest I've seen it," one UK-based gas trader said. "It was 45 or 47 million cubic meters long this morning."
By 1100 GMT, the supply/demand margin had narrowed to show the system 33 million cu m long with National Grid forecasting the day's demand at 227 million cu m -- compared to a seasonal norm of 271 million cu m.
The oversupply saw gas for within-day delivery fall to 57.40 p/th at 11:00 am Friday from 58.55 pence/therm Thursday. Day-ahead gas was down by 0.25 p/th at 58.00 p/th and the Weekend fell by 0.20 p/th at 57.30 p/th. There were strong flows through Norway's Langeled line, of 72 million cu m/d, which is its approximate capacity.
The Dutch BBL was also at high rates Friday morning of 40 million cu m/d. The UK-Belgium Interconnector was not sending the UK any gas Friday morning. Exporters could cut their flows to the UK later in the day to put the system back to balance, or else nominations for exports from the UK, or for injections into storage, could increase.
UK gas storage was not flowing out Friday morning, although it had been used overnight.
Gas Storage Europe shows UK gas storage at 51% full with stocks of 2.4 billion cubic meters. That compares with only 15% full at the same time last year.
The UK has entered a relatively early spring in 2014, with months of mild winter weather this year contrasting to cold weather in early 2013 that left heating demand strong into early April, and emptied the country's main gas storage site Rough.
