Archived Summaries

Tuesday 14th August 2012
Market Close
The price of front month Brent has continued to increase and is now at levels last seen in early May having fallen to a low of just over $89 a barrel in the middle of June.   However backwardation in the oil market, where the price of oil for delivery further out the curve is at a discount to the front month is again evident in the market, suggesting that on-going support for the current front month price may not be sustained.   Stronger than expected growth in Germany and France combined  with strong retail data from the U.S. boosted confidence and this kept up the pressure on oil prices.  Brent closed up by 50 cents to finish at $114.03 as West Texas increased by 70 cents and narrowed the gap with Brent.   Deliveries of gas into the UK system at 167 MCM kept the system in balance throughout the day with continuing healthy LNG output from Milford Haven at 45 MCM compensating for weak Norwegian flows.  Both prompt and futures gas prices generally moved higher in line with the momentum in oil prices.  Within day and day ahead increased by 0.55p and 0.40p respectively while further out the curve Winter 12 gained 0.19p to close at 66.24p having recorded an increase of 1.59p over the past five days.