UK Gas Prices Drop to Record Low on Ukraine-Russia Deal

UK Gas Prices Drop to Record Low on Ukraine-Russia Deal

LONDON, Oct 31 (Reuters) – British wholesale gas prices for the rest of this year fell on Friday after Ukraine and Russia signed a deal that will see Moscow resume gas supplies to Kiev this winter, while warm UK weather and high storage levels added to the bearish tone.

Russia is Europe’s biggest supplier of gas and provides around a third of the continent’s needs, pumping roughly half of that via Ukraine. Some of this reaches Britain from continental European storage sites.

Failure to reach an agreement would have raised fears of disruptions to European gas supply via Ukraine this winter, but prices of wholesale natural gas had already been declining on Thursday afternoon in anticipation of a deal.

The UK gas contract for delivery in November was trading at 52.20 pence per therm at 0915 GMT on Friday, down 1.5 percent from the previous settlement. It earlier touched 52.00 pence, its lowest since the contract began trading.

The December contract was at 54.60 pence per therm, down 1.7 percent, having touched its lowest ever level of 54.40 pence in earlier trade.

However, traders said the falls were not that substantial.

Read more at Reuters


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