Strong dollar continued to weigh on crude oil prices

Tight supply concerns once again spurred on natural gas prices

Tight supply concerns once again spurred on natural gas prices in Britain on Monday as the prompt and near curve contracts gained over 25.00p per therm. The GB gas system ran short early on with news of an unplanned outage at Elgin Franklin field, however the system recovered with draws on storage gas supplies making up the shortfall by the afternoon session.  The front of the NBP curve was also buoyed by news that Gazprom have not booked any extra firm transit capacity through Ukraine for October.  At the close, the spot and day ahead products settled at 183.05p, while near curve contracts all closed over 190.00p save for October which settled at 189.65p.

Carbon EUAs out to 2024 all moved higher

Baseload power futures tracked gains in gas and carbon markets on Monday as near contracts climbed by an average of £15.60/MWh. The front month settled at £176.00/MWh, while the winter-21 contract settle at £178.00/MWh.  Carbon EUAs out to 2024 all moved 1.6% higher with contracts closing in a range of €60.45 to €62.29 per tonne. A tick up in wind generation and forecasts for further increases through the week pressured the day ahead baseload product which settled at £180.00/MWh, down over £200.00/MWh from the value for Monday.  Wind generation is forecast to average around 7.0GW this week.

Refiners along the Gulf have returned

A strong dollar continued to weigh on crude oil prices on Monday while a return to action in the Gulf of Mexico also provided some downside.  Refiners along the Gulf have returned after being shut in by the recent hurricanes, however, Shell have said its output in the area will remain curtailed for some weeks to come while repairs to hurricane damage are completed and this curbed losses on the day.  The dollar has been strengthening over the past week as investors hedge their risk ahead of this week’s meeting of the U.S. Federal Open Market Committee, taking place later today and Wednesday. Brent closed $1.50 a barrel down at $73.92 a barrel.

NBP futures market has opened softer

The GB gas system has opened with a surplus this morning as Norwegian nominations have increased with Langeled flows up almost 10MCM on Monday.  The NBP futures market has opened softer although latest trades have seen early losses being pared back.  The October contract last traded at 187.00p, having been at 179.44p earlier while the winter is down 0.83p from yesterdays close.  Crude oil prices have switched tack this morning with both benchmarks around 90 cents a barrel higher.