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Prices for gas in Europe are little changed, as the market ignores geopolitical risk

The Dutch and British wholesale prices of gas were mostly stable on Wednesday, as the geopolitical tensions in the Middle East, Europe and Russia, where Russian drones invaded NATO member Poland's airspace failed to counterbalance a market that was balanced.

LSEG data shows that the benchmark Dutch front-month contract was 32.75 euros per Megawatt Hour (MWh) or $11.23/mmBtu at 0820 GMT. This is a decrease of 0.03 euros.

The Dutch day-ahead contracts was down by 0.30 euros to 32.60 euros/MWh.

The British gas front-month price fell by 0.25 pence, to 80.38 p/therm. However, the day-ahead contract rose 0.85 pence and now stands at 81.25 pence/therm.

A trader stated that the market response to Israel's attack on Hamas leaders in Qatar was quite muted, as it had no impact on liquefied gas (LNG).

The price of oil did not change much after the Russian air raids on Ukraine during the night and several Russian drones entering Polish airspace.

The trader stated that "in the middle of maintenance (of the Norwegian continental shelf), I would have expected to see a little more premium factored in."

He said that a stronger response would require a combination simultaneous events, such as prolonged outages in Norway and increased demand on the spot market from Chinese buyers.

Analysts at Northern Gas & Power stated in a morning press briefing that European storage levels are still healthy, at just below 80%. The planned maintenance of the Norwegian pipeline will be completed in the next few weeks.

The price of oil is susceptible to swings due to the uncertainty surrounding winter demand, and other risks that may be present in supply regions.

Analysts said that cooler temperatures in Britain Wednesday morning are helping to support the day-ahead price of gasoline.

The benchmark carbon contract in Europe was down by 0.16 euros at 76.74 euro per metric ton. Nora Buli, reporting from Oslo; Susanna Twidale, editing)

(source: Reuters)