Crude oil prices declined for the second day in a row
16 July 2021
UK gas system was balanced by the afternoonA tight gas system continued to cause concerns for the NBP gas market on Thursday, but prompt prices fell on day as the UK gas system was balanced by the afternoon. The spot and day ahead closed over 2.00p down as supplies from Norway increased to cover the morning deficit. Demand was just 133MCM, but LNG send out fell below the average send out for July yesterday which is already down to around 25% of the levels seen last July, meanwhile storage reserves remain below 25% of capacity. On the curve, futures at the front of the curve shed an average of 2.30p while contracts from next summer out recorded losses averaging 0.40p.
Baseload for the day ahead declinedBaseload for the day ahead declined by over £4.00/MWh on Thursday despite forecasts for wind generation to decrease. The power prompt looked to falling prompt prices on the NBP yesterday and the expected drop in wind curbed losses on the day. Wind generation is expected to fall by around 20% to around 4.0GW for today. The GB power futures market also tracked the NBP lower yesterday, and near contracts averaged losses of £1.55/MWh. While futures past the front winter contract generally declined yesterday losses were more marginal.
Crude oil prices declined for the second day in a row yesterday with Brent closing $1.29 a barrel down. It’s only the second time since mid-May that the global benchmark has recorded back-to-back losses. The news of Saudi Arabia and the United Arab Emirates reaching a compromise which could see more crude oil being released into the market weighed on prices yesterday although discussions between the two are believed to be still ongoing. U.S. crude oil stocks fell by 7.9 million barrels last week and reserves are just below the five-year average at 437.6 million barrels. This would normally boost crude oil prices but the report from the Energy Information Administration also showed gasoline and distilled products were topped up.
U.S. crude oil stocks fell by 7.9 million barrels last week