U.K. natural gas for next-month delivery rose for a sixth day, the longest such streak since December, amid forecasts for colder weather and continued Norwegian outages.
Gas for front-month delivery advanced as much as 2.4 percent on the ICE Futures Europe exchange in London. The December contract expires on Nov. 27. First-quarter fuel climbed to the highest level in almost a month on ICE, also advancing for a sixth day.
Temperatures in the U.K., where gas is mainly used for heating, are set to be 1.6 degrees Celsius (2.9 degrees Fahrenheit) below seasonal norms next week, according to a WSI Corp. forecast using the GFS model on Bloomberg. Supply from the Troll and Skarv fields in Norway remain reduced as outages continued, dragging up the curve with the prompt prices, according to Trevor Sikorski, head of natural gas, coal and carbon at Energy Aspects Ltd.
“The disruptions at Troll and Skarv have meant that storage withdrawals have had to increase in Europe and this then puts some more risk premium onto the later months of the winter,” Sikorski said by e-mail. “Also, the early December forecasts are for colder than normal weather and that will help stimulate a bit more buying.”
Front-month gas rose as high as 57.45 pence a therm ($9 a million British thermal units) and traded at 57.37 pence by 10:09 a.m. London time on ICE. The volume of all futures traded was more than double the 100-day average for the time of day. First-quarter gas gained as much as 1.8 percent to 58.05 pence a therm, the highest since Oct. 29, before trading at 58 pence.