Italy monitors gas storage levels as cold snap drives price spike
MILAN (Reuters) -- Freezing weather has driven Italian wholesale day-ahead gas prices up 50% in the past three trading sessions, prompting suppliers to step up gas withdrawals from storage.
The price of gas for delivery on Wednesday rose 23% on Tuesday to 31.50 euros per megawatt hour, extending a bull run that began late last week.
"The cold snap has sent prices rocketing and has already prompted a response from Rome," a Milan gas trader said.
On Tuesday the Italian Industry ministry said it was monitoring gas storage levels as strong demand due to the cold snap drew down stocks.
The ministry said gas storage was currently 61% full, enough to meet national demand.
"It is however important to ensure storage levels stay at adequate levels to the end of winter," it warned, adding companies supplying end users had recently been withdrawing more gas from storage than their normal contracted levels.
Weather forecasts indicate the cold spell in Italy will continue until at least Jan. 12, the ministry said.
Reporting by Stephen Jewkes and Oleg Vukmanovic; Editing by Ruth Pitchford
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