Prices edge higher on low wind output

Dutch and British wholesale gas prices edged higher on Thursday morning as forecasts for lower wind power output increased demand for gas from gas-fired power plants, but prices remained close to 20-month lows.

The benchmark Dutch front-month contract at the TTF hub (TRNLTTFMc1) was up 0.23 euro at 26.98 euros per megawatt hour (MWh) or $9.25/mmBtu, by 0845 GMT, LSEG data showed.

The contract hit an intra-day low of 26.55 euros/MWh on Wednesday, a level not seen since April 2024.

On Thursday the Dutch February price (TRNLTTFMc2) was up 0.18 euros at 26.98 euros/MWh.

The British February contract (TRGBNBPMc2) was up 0.61 pence at 69.96 p/therm.

Non-local distribution zone demand in Northwest Europe, which includes power plant demand, is expected to rise 242 gigawatt hours/day for the day-ahead, at 3,138GWh/d, driven by a dip in wind power output on Friday, LSEG analyst Saku Jussila said in a daily research note.

Technical buying was also providing some support after prices hit fresh 19-month lows on Wednesday. The relative strength index (RSI) of the Dutch front-month contract has been below 30 this week, according to LSEG data, a technical threshold indicating a stock or commodity may be due for an upward correction.

Fundamentally however the market remains weak.

“Until Christmas at least, temperatures are expected above or at least not below average in Germany – Europe’s largest gas consumer and it now appears clear that we are getting well through winter without any major increase in demand,” analysts at Mind Energy said.

In the European carbon market, the benchmark contract (CFI2Zc1) was 1.02 euros higher at 83.43 euros a metric ton.