A fall in UK carbon prices pressured contracts further along the curve

Tuesday turned in a choppy day of trading

Tuesday turned in a choppy day of trading for the near curve on the NBP after reports of reduced gas flows at the Velke Kapusany point, a delivery point for Russian gas to Slovakia, but futures settled lower for the most part.  Contracts at the front of the curve had opened softer early on as May and June declined by around 6.50p but these losses were reversed mid-way through the session.  The front month traded up to 183.00p before switching direction once again and settled at 173.33p, down 3.93p day on day.  Planned maintenance works will cut capacity at the Troll field by around 25% for the next couple of days and forecasts for temperatures from the weekend are now closer to normal, which gave a boost to the prompt yesterday as contracts settled around 162.50p.

 GB baseload futures tracked movement on the NBP gas futures curve on Tuesday

GB baseload futures tracked movement on the NBP gas futures curve on Tuesday but failed to decline later in the session leaving the curve to settle with gains of around £4.00/MWh.  A fall in UK carbon prices pressured contracts further along the curve, while the front month settled flat.Wind generation is now forecast to remain below average levels seen for the first half of April with latest estimates at 5.4GW of generation for next week. The renewable source only contributed 3.2GW yesterday but the day ahead baseload contract remained stable.

The surge in crude oil prices was halted yesterday

The surge in crude oil prices was halted yesterday after the International Monetary Fund lowered its forecast for economic growth by a full percentage point and warned about the impact of inflation for many countries.  Brent declined by $5.91 a barrel to close at $107.25 on Tuesday after closing at $113.16 a barrel on Monday after supply disruptions in Libya provided support.  The IMF have blamed the Russian invasion of Ukraine for the revision and also a sharper than expected slowdown in China after the lockdowns for the latest wave of Covid-19.  The U.S. benchmark settled $5.65 a barrel down at $102.56 a barrel.

 Crude oil prices have opened firmer

Crude oil prices have opened firmer this morning after Tuesday’s sharp losses.  The global benchmark is trading 71 cents a barrel higher at $107.96 a barrel as early industry reports show U.S. inventories fell last week while concerns of tighter supplies from Russia and Libya continue to offer support.  In the GB gas markets, the front of the curve has increased from last night’s close as the May contract last traded at 107.96p.  Trading at the prompt has been thin and the day ahead is 3.50p higher at 166.00p.  The GB gas system is forecast to run 9MCM long against the demand of 266MCM for today.  

Find out more about our Commercial Energy Services