UK gas prices at the National Balancing Point drifted lower Wednesday as a well-supplied system put some pressure on the prompt, although curve prices were still offering some support to the near-term contracts, traders said. Within-day was down to 17.75 p/therm by midday GMT, down from 18.5 p/th Tuesday, while day-ahead was at 17.95 p/th, down from 18.6 p/th. National Grid data showed demand bang on seasonal norms at 1100 GMT, at 335 million cubic meters/day, and system length at 7.9 million cu m. “We’re well-supplied but the curve is still holding the prompt up a little,” said one trader. “It’s not going to drop massively.” March was trading at 18.35 p/th at lunchtime, down from 18.8 p/th on the previous day, and still below the summer months. April was at 18.5 p/th and
May at 18.7 p/th. Several traders have said they are suprised at the summer premium over the front month. “Everything happening on the prompt is persuading me that the summer should be coming off, but obviously someone else thinks differently,” said one trader. On the far curve, trading was sparse and contracts drifted without any solid direction. “It’s deathly quiet,” said one trader. “The movement’s all pretty irrational at the moment. I think people would like it to come off again, but are too scared to get involved.” Winter 07 did trade down, reaching 40.75 p/th during the morning before firming to 41.2 p/th by lunchtime, compared with Tuesday’s close of 41.95 p/th. Winter 08 was also off, to 41.25 p/th from 42.1 p/th Tuesday, while summer 08 moved sideways to 29.4 p/th.

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