U.K. natural gas network operator National Grid PLC (NGG) sought to
reassure consumers Monday that there would be sufficient supplies to a meet a
new all-time high in demand, despite the utility issuing a gas balancing alert
Sunday.
This reassurance didn't stop
U.K.
wholesale gas prices hitting a two-year high. By early afternoon the price for
gas delivered on Tuesday had risen above 70 pence a therm for the first time
since October 2008, according to data from Heren Energy.
"Healthy levels of electricity generation and gas available from a diverse
range of sources has left supply and demand balanced despite current high
demand levels due to the cold weather," the utility said in a statement.
The gas balancing alert issued Sunday, which can lead to some large industrial
gas users having their supply diverted to households, was described in the
statement as a "routine market tool...making additional supplies available
or reducing demand by switching electricity generation from gas to other
fuels."
Only consumers on discounted contracts that allow for their supply to be
reduced during periods of high demand are affected by the alert.
Within-day
U.K.
natural gas prices have risen nearly 16% since last Monday, as a result of the
extra demand, and were trading at 71.2 pence per therm at 1033 GMT Monday, a
gas trader in the
U.K.
said.
Lower Liquid Natural Gas flows in recent weeks have also helped tighten the
system the trader added, but noted within-day flows have increased after the
LNG tanker Al-Huwaila berthed at the Isle of Grain regassification terminal in
Kent
,
England
,
Saturday.
The Isle of Grain terminal is able to import 9.8 million metric tons of LNG a
year.
Total gas demand is expected to hit 465.8 million cubic meters Monday, just
above the previous all time high of 465.5 million cubic meters on Jan. 8 this
year.
Much of
Europe
is experiencing unusually cold weather and heavy
snowfall for the time of year. Transport links have been severely disrupted across the continent.