UK – Nov 2017

Published at 16:02 5 Dec 2017 by . Last edited 17:06 5 Dec 2017.

Mild weather and high wind generation cut aggregate UK gas demand (including for exports) by 1.17 bcm (13%) y/y to 7.80 bcm in November, aided by an 8% y/y fall in HDDs, although they were 4% higher than the past five-year average.

UK end-user consumption was 7.28 bcm, down by 1.12 bcm (13%) y/y. In an ongoing trend, gas into power fell y/y thanks to lower power demand and as renewable output increased its share of the generation mix, curbing thermal generation. The UK power sector's call on gas was 0.28 bcm (13% y/y) lower y/y at 1.85 bcm. Gas-fired power generation dropped by 1.27 TWh (10%) to 11.48 TWh, while wind generation rose by 1.42 TWh (64%) y/y to 3.66 TWh.

Total supply to the UK was down by 8% (0.69 bcm) y/y to 8.30 bcm in November as a small uptick in LNG sendout was offset by lower continental pipeline imports. Dutch exports to the UK totalled 0.29 bcm, down by 0.62 bcm (68%) y/y. Dutch output was again lower last month owing to a stricter Groningen cap and the milder weather, with the drop in supply buoying TTF prices and discouraging continental flows to the UK. Net IUK exports to Belgium were just 4.2 mcm/d in November, down from 19 mcm/d last year. Norwegian exports to the UK were 3.74 bcm, just 50 mcm (1%) more y/y.

UKCS flows were once again up y/y last month, owing to the ramp up of the Cygnus field which came online in December 2016. North Sea deliveries to UK terminals were up by 0.21 bcm (7%) y/y at 3.33 bcm. LNG deliveries into UK ports slowed y/y in November, but sendout edged up by 30 mcm (10%) y/y to 0.32 bcm because fast receipts in October left stocks much higher y/y. LNG stocks were 84% full on 1 November and ended the month at 62% capacity. Strong Northeast Asian demand continued to support LNG spot prices, encouraging 0.07 Mt of UK reloads in November, according to Kpler.

The UK made a net withdrawal of 0.30 bcm in November, leaving stocks at 1.50 bcm, down by 0.85 (45%) bcm y/y. Given our December forecasts, we expect UK stocks will be 1.31 bcm on 1 January.

Over Q1 18, we forecast that UK end-user demand will be up by 0.49 bcm y/y, although that is based on a return to normal temperatures and forecasts are for a colder January. The arrival of 0.55 bcm more LNG y/y and pipeline imports up a modest 0.03 bcm y/y in Q1 18 would see the UK taking 0.65 bcm out of storage over the quarter, leaving storage inventory levels at 0.6 bcm at the end of March.

For summer 2018, we forecast that LNG imports will grow by 1.1 bcm (27%) y/y given expected incremental LNG, pipeline imports will fall by 0.82 bcm (6%) y/y, while exports to the continent rise by 1.0 bcm (12%) y/y.

Log in to download

Other Europe publications

Russian flows to EU: Where to now?

Published 14 hours ago

2018-10-15 Natural Gas - Europe - Russian flows to EU: Where to now? cover

A key uncertainty for the EU gas market concerns the level of Russian gas imports that we can exp..

Read more

European gas

Published 16 hours ago

2018-10-15 Natural Gas - Europe - European gas cover

Europe needed a mild, windy October to make progress on closing the y/y storage gap ahead of the..

Read more

EU imports – Sep 2018

Published 3 days ago

2018-10-12 Natural Gas - Europe - EU imports – Sep 2018 cover

As we move into the European winter, the outlook for imports appears mixed. LNG supply looks like..

Read more

Central Eastern Europe – Sep 2018

Published 3 days ago

2018-10-12 Natural Gas - Central Eastern Europe – Sep 2018 cover

The CEE region started gas year 2018/19 with stocks 2.1 bcm lower y/y, as September saw Russian f..

Read more

Neth., Belg., France, Germany - Sep 2018

Published 4 days ago

2018-10-11 Natural Gas - Europe - Neth., Belg., France, Germany - Sep 2018 cover

As we head into the winter months, we do expect underlying gas demand in the NW continental regio..

Read more