Strong price gains were heard on prompt contracts across the continental European gas hubs by lunchtime Wednesday on short supply at the UK's NBP system and strong German power prices, traders said.
Flows into the UK through the Langeled pipeline dropped off Wednesday as increased demand left the NBP system short by 30 million cubic meters/day according to data from the National Grid website.
As a result gas exports from the Netherlands to the UK via the BBL pipeline ramped up from around 13.7 million cubic meters/day Tuesday night to almost 24 million cu m/day mid-morning.
The TTF day-ahead contract gained 35 euro cent from Tuesday's close to change hands midday, London time, at Eur21.95/MWh.
The TTF front month gained the same amount to trade at Eur22.20/MWh midday.
German power prices reached a 5 week high over the morning as warm weather and low wind power output stoked demand for gas-fired power.
Germany's continued strong demand for gas and increased gas flows moving from the continent to the UK helped to push up prompt prices on the German NetConnect and GASPOOL hubs up.
The NCG day-ahead contract climbed 50 euro cent from the previous close to Eur22.20/MWh, while the neighboring GASPOOL contract rose 30 euro cent over the same period to Eur22.15/MWh.
France's PEG Nord contract rose 40 euro cent from Eur21.60/MWh at Tuesday's close to Eur22.00/MWh midday Wednesday following bullish sentiment on neighboring Continental markets.
Italy's PSV contract traded flat to its previous close of Eur28.40/MWh midday.
"The curve remains oil-driven and concern over potential LNG diversions from Europe to Japan this winter is causing the spread between Q4 2011 and Q1 2012 gas to widen in response," a trader said.
The TTF Winter 11 contract lifted 25 euro cent from Tuesday's close to trade at Eur27.45/MWh as Brent crude rose over the morning.
At 0845 GMT, new front month October ICE Brent was up 73 cents at $109.86/b before rising above the $110/b mark midday to trade at $110.26/b.
The TTF Cal 12 heard morning gains of 25 euro cent to change hands at Eur27.25/MWh midday.
