Archived Summaries

Tuesday 21 August 2012
Market Opening
  With forecast demand on the UK gas system falling to 175 MCM for today, the forecast supply-demand balance is better than yesterday, with the system currently running a forecast deficit of 6 MCM.  Physical deliveries into the system are currently running almost 30 MCM short however following a turn-down in LNG supply overnight and in a repeat of yesterday morning's trading pattern, the spot price has risen by over 4.00p while day ahead is up by almost  2.00p, both trading at just under 56 pence.  Yesterday's system shortfall was recovered by substantial increases in LNG send out with Milford Haven ramping up to 60 MCM and the Isle of Grain contributing 12 MCM later in the day to restore system balance, albeit after the markets closed.  It looks like increased LNG production will again be needed today and this seems most likely as LNG storage is in good shape and 5 more shipments are due in the UK over the next 2 weeks.  Gas futures are strengthening again this morning with crude oil prices on the increase again.  The front month has gained 0.25p and the front winter is up 0.35p as Brent trades 75 cents above last night's closing level at $114.45.