Jan 7 (Reuters) - European and British wholesale gas prices
mostly eased after an initially bullish start on Friday morning,
as a steady stream of U.S. LNG arrivals continues to mitigate
lower Russian gas flows.
The British contract for day-ahead delivery was
up 0.50 pence at 228.50 pence per therm by 1007 GMT, with
weekend prices down 1.00 pence at 226 pence/therm.
In the Dutch TTF gas market, the day-ahead price
was down 0.80 euros at 95.70 euros per megawatt hour (MWh).
The benchmark front-month contract opened at a
9-day high of 103 euros/MWh but has since fallen and is down 2
euros at 96 euros/MWh.
Prices initially rose due to cooler weather forecasts, but
with sea-borne deliveries of liquefied natural gas (LNG) priced
to come to Europe instead of going to Asia, the market is happy
at the current levels, a trader said.
"LNG is mitigating the lower Russian flows," the trader
added.
Flows on the Polish section of the Yamal-Europe pipeline
bringing Russian gas to Europe remained in reverse at the German
border point of Mallnow for an 18th consecutive day, with flows
on another pipeline route via Ukraine also consistently low.
Meanwhile, about half of record U.S. LNG volumes shipped in
December went to Europe after prices spiked above their Asian
LNG.
Temperatures in the UK should adjust higher over the
weekend, while the forecast for north-west Europe turned
slightly colder suggesting normal levels next week, Refinitiv
analysts said in a morning note.
On the supply side, Norwegian flows to the UK were up
slightly on Friday.
Meanwhile, the Dutch government on Thursday proposed
allowing production from the Groningen gas field to nearly
double this year to 7.6 billion cubic meters (bcm) to guarantee
security of supplies.
A final decision is only due in April and the announcement
should have little direct impact on near-term prices, traders
said.
In other markets, the European benchmark December 2022
emission allowance (EUA) contract rose by 0.51 euro to
87.24 euros a tonne.
(Reporting by Nora Buli in Oslo; editing by Nina Chestney)