Gas prices rise on higher eastbound Yamal volumes

European and British wholesale gas prices rose again on Thursday as supplies along a major pipeline which usually carries gas from Russia to Europe flowed in reverse for a 17th successive day. 

Eastbound volumes on the Yamal-Europe pipeline, from Germany to Poland, increased sharply earlier in the day, data from German network operator Gascade showed, dashing hopes for a resumption of Russian gas deliveries after a slowing of reverse flows on Wednesday. 

The long run of reverse flow has sparked concerns about winter gas supply in Europe, higher prices and political tension with Russia, which has repeatedly said it is meeting all its contractual obligations.

The British gas contract for February delivery was up 6.1% pence at 240 pence per therm by 1210 GMT, while the within-day contract rose by 7.2% to 230.5 p/therm. 

The Dutch contract for the day-ahead was up 5.4% at 94.9 euros ($107.27) euros per megawatt hour.

European prices soared by more than 30% on Tuesday when operators returned after the New Year break facing concerns about low winter supplies.

Some European Union lawmakers have accused Russia, which supplies around a third of Europe's gas, of restricting flows to secure approval for the newly built Nord Stream 2 pipeline, which will supply gas to Germany.

Russia denies the allegations, and says the pipeline will boost gas exports and help alleviate high prices in Europe.

Its energy exports are also in focus because of a broader standoff between Russia and the West, including over a Russian troop buildup near neighboring Ukraine, which is trying to forge closer ties with NATO. 

Eastbound Yamal volumes stood at 7.5 MM kilowatt hours an hour (kWh/h), up from 1.7 MM on Wednesday evening and just over 1 MM overnight, data from the Mallnow metering point on the German-Polish border showed.

Refinitiv analysts said the rise reflected an additional capacity of 147 GWh/d, equivalent to 6.125 MM kWh/h, bought at auction on Wednesday.

Capacity nominations from Ukraine to Slovakia at the Velke Kapusany border point, another major route for Russian gas to Europe, were at 288,635 MWh, in line with levels seen this week but less than half those seen in the final weeks of 2021.

The volatile gas market has prompted German utility Uniper to secure credit facilities worth up to 10 B euros ($11.30 B) from Finnish parent Fortum and state bank KfW in a precautionary move. 

Sector peers RWE and Enel said they were prepared to deal with possibly high security payments. 

Rystad analysts in a research note said weather forecasts suggest European temperatures will trend at normal levels in the coming weeks, a downward revision from previous forecasts for warmer than average weather. 

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