LONDON, July 12 (Reuters) - British gas prices rose on Thursday after two
days of consecutive losses as cooler weather supported demand and uncertainty about the arrival of liquefied natural gas (LNG) tankers spread winter supply concerns.
Gas for delivery on Thursday rose 0.95 pence to 55.70 pence per therm as gas demand rose day on day with temperatures dropping around 4 degrees Celsius below seasonal norms, National Grid data showed.
The market was also undersupplied as imports from the Netherlands fell and production at Centrica's South Morecambe gas field was cut again due to technical problems, just days after it returned from maintenance.
Gas for Friday delivery also rose as traders said prices had reached bottom levels after an end to strikes in Norway on Monday caused a 7 percent drop in UK gas prices.
August and September gas prices followed suit on Thursday and gained day on day as the prompt led bullish sentiment.
The summer will see further maintenance cuts as Apache announced reduced output from its Beryl Alpha and Bravo fields in September, while the SAGE pipeline feeding the St Fergus terminal will reduce flows by 7.5 million cubic metres per day (mcm/d) from Aug. 1-6 and again Aug. 25-Sept. 12.
August gas added 0.20 pence to 54.90 pence per therm, while September gained 0.35 pence to 55.85 pence.
Traders also said they were increasingly concerned about LNG supply to Britain over the coming months as it was unclear whether a recent drop in Asian demand and LNG prices would last.
'There is fear over supply, the National Grid report was completely blind over LNG supply levels,' one UK gas trader said.
In its winter outlook report on Monday, UK network operator National Grid gave a wide forecast range for LNG supply this winter as it said it was difficult to predict the market.
'To manage the supply uncertainty surrounding LNG, a wide range is considered, namely from 30 to 100 mcm/d, with an average winter flow of just 45 mcm/d,' National Grid said.
Norway's Statoil also announced a temporary outage at its Snoehvit LNG terminal following a water leak, adding to the supply uncertainty.
Winter gas prices gained 0.45 pence on Thursday, trading at 63.95 pence per therm.
In Britain's power markets, spot prices fell day on day, but traders said spark spreads, the profit of burning gas for electricity production, were rising on the back of lower gas prices.
'Day-ahead gas is lower than it was at this time yersterday so prompt sparks are actually higher,' a UK-based power trader said.
Spot baseload power prices traded at 43.25 pounds per megawatt-hour (MWh), down 25 pence day on day.
Winter power prices rose in line with the gas market to 47.60 pounds per MWh and the trader said he expected winter spark spreads to remain low as the market held a high amount of spare capacity.
(Reporting by Karolin Schaps; Editing by Alison Birrane)
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