British wholesale spot gas prices rose above 90 pence a therm on Tuesday morning as extreme cold pushed up demand and further reduced already far depleted gas storage levels.
Gas prices for delivery within the day were trading at 93 pence a therm at 0820 GMT, up 4 pence since closing on Monday, and prices for delivery the next day were up 3.85 pence to 92.75 pence per therm.
Power prices for baseload (24 hours) delivery on Wednesday were also bullish, rising 4 pounds ($5.96) per megawatt-hour (MWh) to 66 pounds a MWh
Traders and analysts said the high prices were a result of the extreme cold and the low storage levels.
“This sort of cold and the high demand that comes with it is unusual in mid-March, and the depleted storage levels won’t be able to cope with it for long,” one gas trader said.
Gas demand in Britain was expected to be 369.4 million cubic metres (mcm) on Tuesday, almost 32 percent above the seasonal norm, according to data from National Grid.
With supplies seen at almost 373 mcm, the system would just be able to meet demand, but analysts said that utilities were withdrawing storage in order to meet the needs.
UK gas prices remain high on cold weather