The contract moved down in early trading from an opening level of around 16.10-16.00 p/th to 15.50 p/th —on par with Within-Day, but liquidity quickly dried out, as demand was strangled by the current heatwave.
Nevertheless, Day-ahead basis attracted some interest, being bid-offered at 1.45-1.55 p/th, with a 250,000 therm parcel changing hands at 1.45 p/th. Continental demand in Germany is not expected to pick up until September as the majority of schools there have only just begun their holidays.
As a result, players say Day-ahead and Balance-Of-Week should remain below 16.50 p/th in the near future. Elsewhere in the prompt, the thin liquidity resulted in spreads as wide as 2.00 p/th being witnessed in Working-Days-Next-Week, which was quoted during the afternoon at 15.20-17.20 p/th.
In the curve, the front month held firm, but overall, players predict more downside than upside potential for the September and October. “Brae is one of the last fields due for maintenance, so from the British side there is not much supply interruption expected in the coming months, ”said one player. “The main factor impacting continental prices will be the Interconnector, and whether there are problems like those encountered last year.” Participants say the extended closure of the Rough storage facility has already been factored into prices. Subject to an unexpected drop in temperatures, demand in October will, they say, be primarily for injection into storage, and though upside potential here is higher than for September, in absolute terms it will be limited.Given that October is considered a low period for maintenance, participants predict that lower demand at the start of the new gas year from continental players who have signed take-or-pay contracts will put downward pressure on the contract.

In the far curve, periods tracked the NBP, where prices were once again impacted by rally in the power markets, as electricity companies hedged their spark spreads on gas prices. The pattern is similar to that witnessed towards the end of last week, say traders, suggesting that the impact on gas prices was around 0.10-0.20 p/th on the day.
Zeebrugge contracts from Q4 ’03 outwards consequently retraced, ending the session a touch lower. At the Dutch TTF, activity dropped sharply from the exceptionally high volumes traded last Friday. Players said there had been very little interest displayed in the market, which they attributed to the overall thin discussion witnessed across all markets (NBP, Zeebrugge) on the day.
Summer ’05 —quoted on Monday at EUR 9.80-9.95/ MWh, was around EUR 0.30/MWh below Summer ’04 at EUR 9.80-9.95/MWh, which traders say is the normal price differential between the nearest successive Summer periods.

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