Russian deliveries to Western Europe continued to alleviate pressure

UK gas prices eased significantly for a third consecutive day

The modest increase in Russian deliveries to Western Europe continued to alleviate pressure on gas prices on Friday. UK gas prices eased significantly for a third consecutive day on Friday and finished lower week-on-week for the first time in 3 months. Having briefly traded above 400.00p and settled at 293.91p on Tuesday, the front month contract shed over 20.00p for each of the remaining sessions last week to settle at 222.21p on Friday. Remaining winter months saw similar losses and the Summer 22 contract fell below 100.00p. The day ahead contract fell in concert with the front month finishing at 186.55p, the first time it has settled below 200.00p so far this month.

Baseload power futures for most of the remaining winter months tumbled

Baseload power futures for most of the remaining winter months tumbled in line with gas and carbon prices on Friday. The front month was the exception, shedding only half the premium of the other months but still settling lower week-on-week. Carbon fell further on Friday leaving EU ETS unit prices down by €5.50 over the week. The day ahead baseload contract shed £12/MWh but remained above £200/MWh as wind generation is forecast higher again today. Wind levels fell short of forecasts on Friday, but lower demand helped keep prompt prices on the slide.

Crude oil gained for a fourth session in five last week

Crude oil gained for a fourth session in five last week with Brent up by 44 cents on the day and $3.11 a barrel week-on-week.  While the stronger dollar helped move prices lower midweek, its gradual easing towards the end of the week saw increases on Thursday and Friday.  The tipping point for switching from gas to oil has been breached in recent weeks and oil demand is expected to recover in Q4.  OPEC+ have decided to stick with the gradual increases in production agreed last quarter however and this is likely to maintain fine supply-demand balance throughout the winter months.  Carbon fell further on Friday leaving EU ETS unit prices down by €5.50 over the week.

UK gas prices finished lower week-on-week for the first time in 3 months

UK gas prices eased significantly for a third consecutive day on Friday and finished lower week-on-week for the first time in 3 months.  Having briefly traded above 400p and settled at 293.91p on Tuesday, the front month contract shed over 20.00p for each of the remaining sessions last week to settle at 222.21p on Friday.  Remaining winter months saw similar losses and the Summer 22 contract fell below 100.00p.  Crude oil gained for a fourth session in five last week with Brent up by 44 cents on the day and $3.11 a barrel week-on-week.  Carbon fell further on Friday leaving EU ETS unit prices down by €5.50 over the week.