NBP futures extend gains after a stormy session
A turbulent day of trading saw NBP futures posting significant gains in early trading before a late sell off limited the daily gains. The strong start to the trading session was sustained in the NBP prompt which rose steadily throughout the day to finish at 175.00p a rise of 64.95p a therm. The front month of December opened strongly and rose to 336.77p before slipping back to settle at 311.42p a therm, giving a moderate daily increase of 5.98p. The market remained undersupplied by as much as 20 MCM for the morning, with supply only exceeding demand in the afternoon. After a period of high wind generation, Thursday saw an increased demand for gas for power generation as wind generation fell.
GB Baseload power contracts see near curve gains
GB baseload experienced a stormy session yesterday reflecting the movements in the NBP gas contracts. Baseload contracts for the front month of December increased £9.25/MWh to end the day at £337.50/MWh. Further out however prices slipped with the Q1-23 contract dropping £5.50/MWh settle at £516/MWh. Unplanned outages in Norway reduced upstream capacity by 37 MCM a day adding pressure to the day ahead contract which jumped £74.44/MWh from £95.561/MWh to end the day at £170.00/MWh. Wind generation is forecast to exceed seasonal averages for the coming fortnight relieving pressure on the baseload.
Crude oil markets reserve direction after two days of gains
Crude oil markets reversed direction after two days of gains and retreated yesterday as confidence in the global demand outlook slipped. Oil prices remained under pressure throughout the session yesterday as the impact of the Federal Reserve hike in the US interest rate to 4.00% helped to buoy the US dollar increasing the cost of oil for non-dollar consumers. Contracts for the front month of January slipped $1.49 to end the session at $94.67 a barrel. West Texas Intermediate experienced a similar downward pressure with contracts for the front month of December slipping $1.83 to end the session at $88.17 a barrel.
UK gas contracts open lower this morning
Early trading has been mixed this morning with declines observed in the near curve contracts while contracts from Summer 23 are posting gains. The system has opened with a significant over supply of 16.80 MCM against a forecast demand of 373.60 MCM. Brent crude oil for the front month has yet to trade, but West Texas Intermediate contracts for a December delivery last traded with a notable increase of $2.26 at $90.48 dollars a barrel. The spot and day ahead markets have posted declines with the last trades both at 110p representing a decline of 15.05p.