* Fall reflects reduced demand, healthy storage levels sinceJanuary
* Mild winter has reduced gas consumption
* Exports to Continent will be reduced from June 11 (Updates throughout)
By Nina Chestney
LONDON, May 29 (Reuters) - British day-ahead gas prices weretrading at their lowest levels since November 2010 on Thursday,reflecting oversupply, reduced demand for gas and healthystorage levels since the start of this year.
Prices have been largely bearish this year due to a milderthan average winter and spring which reduced demand for gas.
Gas demand across seven countries which make up 63 percentof total EU gas consumption - including Britain, Italy and Spain- fell 21 percent in the first quarter versus the prior yearperiod, Societe Generale analysts said last week.
Due to oversupply, there have been more injections intostorage than usual and Britain's storage facilities are nowalmost 73 percent full, according to Gas Infrastructure Europedata.
Gas for delivery on Friday was trading at 42.90 pence pertherm at 0923 GMT, down 0.50 pence since the previous close andat their lowest level since November 2010.
"Prices are at these lows because the market has beenoversupplied since January and we have a very healthy storagesituation," said Point Carbon analyst Oliver Sanderson.
"The system is short of gas today but this is unconnected tothe long-term supply situation. We have had a mild winter andconsumption of gas is not picking up anywhere," he added.
Deliveries of liquefied natural gas (LNG) were also healthy.Five LNG tankers were scheduled to unload in Britain by June 8,while one was already docked, adding heavily to gas supplies.
Traders said they were also anticipating oversupply when theInterconnector UK pipeline will undergo maintenance from June11, which will reduce exports to the Continent.
The threat of a Russian gas supply cut to Ukraine from earlyJune was not impacting the market on Thursday. Britain onlysources around 5 percent of its gas from Russia and inventoriesare full enough to offset any wider disruption in supply fromEurope, traders added.
Meanwhile, other contracts also declined. Gas for immediatedelivery was 0.25 pence lower at 42.50 pence per therm, whilegas for Winter 2014 delivery was down 0.27 pence at 60.58 penceper therm. (Reporting by Nina Chestney, editing by William Hardy and SusanThomas)
