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The price of gas in Europe is falling due to strong winds and the ceasefire talks with Ukraine

The price of gas in Europe is falling due to strong winds and the ceasefire talks with Ukraine

The Dutch and British gas price continued to drop on Friday morning, amid high expectations for wind power production and talk of a potential ceasefire in the Ukraine conflict.

The Dutch front-month contracts > dropped by 0.29 euros to 41.79 Euro per megawatt hour at 0907 GMT on ICE.

The Dutch March contract fell by 0.27 euros to 41.66 Euro/MWh.

The British front-month contracts were down 0.43 pence to 102.56 p/therm.

LSEG data indicated that stronger wind speeds are expected for the beginning of next week. Gas for power in Northwest Europe is forecast to be down 201 gigawatt-hours a day (GWh/d), at 2,908 GWh/d on Monday.

The possibility of a Ukrainian ceasefire has also been raised after Russian President Vladimir Putin stated on Thursday that the U.S. proposal was accepted by his country, but any ceasefire must address the root causes of conflict and many details need to be worked out.

Putin mentioned a possible energy partnership between the U.S.A. and Russia, and mentioned a pipeline of gas for Europe.

Analysts at Energy Aspects stated that the market was hedging between Russian gas flowing back and flow levels remaining subdued.

Analysts said that there was still significant opposition from Europe and Ukraine to the restarting of the pipeline flow, along with legal and logistical obstacles.

The Trump administration announced on Thursday that a license for energy transactions with Russian financial institutes expired this week. This increased pressure on Putin to reach a peace deal over Ukraine.

In a daily comment, LSEG analyst Saku Jussila said: "This could be a bullish catalyst for energy commodities generally but shouldn't affect the European Gas Markets directly."

The benchmark carbon contract in Europe fell by 0.80 euros to 69.80 Euros per metric ton. (Reporting by Susanna Twidale, Editing by Shailesh Kuber)

(source: Reuters)