UK GAS-Prices decline on correction, higher Norwegian flows

LONDON, Aug 3 (Reuters) - British wholesale gas prices
declined on Tuesday morning as flows increased from Norway and
prices corrected after gains on Monday.

* The day-ahead contract declined by 0.80 pence
to
106.75 pence per therm by 0834 GMT.

* The system was nearly 16 million cubic metres (mcm)
over-supplied, with demand forecast at 130 mcm and supply at 146
mcm/day, National Grid data showed.

* Norwegian flows have increased, with higher flows via the
Langeled pipeline.

* Wind power output is still low, however. Peak wind
generation is
forecast at 1.2 gigawatts (GW) on Tuesday and 1.8 GW on
Wednesday, Elexon data showed.

* The September gas price at the Dutch TTF hub
fell
by 0.43 euro to 41.72 euros per megawatt hour, after hitting a
new record high on Monday.

* Supply concerns pushed prices higher, particularly a drop
in
flows via the Mallnow compressor station, while weak renewables
output also increased gas-for-power demand.

* However, Norwegian supply is expected to rise later this
week
and a correction of prices is likely, Refinitiv analysts said.

* "North Sea production continues to suffer from significant
outages, delayed from last year due to COVID, as global
liquefaction issues and higher Asian demand also limit LNG
deliveries to Europe," said James Huckstepp, EMEA gas analyst at
S&P Global Platts.

* "Russia is now the only country with spare production, but
in
order to increase exports they would need to book additional
capacity through Ukraine, and up to this point they have
refrained," he added.

* The benchmark Dec-21 EU carbon contract inched
down by
0.08 euro to 54.35 euros a tonne.

* The benchmark Dec-21 British carbon contract was
slow
to trade.
(Reporting by Nina Chestney)