UK gas little changed on slow demand, power soft

British gas prices were little changed on Tuesday, with slow inflows offset by bearish sentiment due to doubts over global economic recovery that have been pulling oil prices lower. Skip related content

Gas for Wednesday was flat at 26.00 pence per therm, while August put on 0.13 pence to 25.20 pence and September was up 0.05 pence at 25.85 pence. The fourth quarter was down 0.10 pence at 39.40 pence.

"In general, people seem to be bearish," said a trader.

The National Grid website showed the system was short throughout the day, giving support to nearby contracts.

Tuesday demand was forecast to stand 14 percent below seasonal norms, with cooler weather damping demand for fuelling air conditioners.

Injections into Rough, Britain's largest long term storage facility, were also limited to about a half as it has filled up quicker than usual.

Prompt contracts have hovered around 25-26 pence for nearly three weeks, while winter 2009 has come down to the lowest levels this year of around 44 pence from above 50 pence early in June in an adjustment to nearby contracts.

"We have a plenty of supply to come on if needs be. We have still got a huge premium on Henry Hub," said another trader, referring to U.S. prices. "Ultimately I still think the (winter) prices are overvalued."

Along the curves, prices were weighed down by oil prices, which were at around $64 a barrel, near its lowest settlement in more than a month.

Winter 2009 stood at 43.75 pence, down 0.05 pence, while summer 2010 edged up 0.1 pence to 40.30 pence and the winter 2010 was unchanged at 55.65 pence.

In the power market, prompt contracts were weaker on cooler weather, which cut air conditioning demand.

Baseload electricity for Wednesday stood at 32.50 pounds per megawatt hour, down from 34.75 pounds for day ahead contracts late on Monday. August was flat at 31.60 pounds, while September was also unchanged at 34.25 pounds.

(Reporting by Nao Nakanishi, editing by Keiron Henderson)