The UK system remain undersupplied throughout the session on Friday
UK gas markets ended the week higher on Friday after oscillating between daily gains and losses. Contracts for the front month of December slipped 3.23p to finish the day at 288.46p a therm. Further out, moderate gains were observed with the 2023 contract adding 1.22p to settle at 318.37p a therm. Despite flows being halted from the UK to Belgium on the Bacton-Zeebrugge Interconnector, the UK system remain undersupplied throughout the session on Friday. Despite the undersupply, there was little movement on the spot market with the within day contract slipping a penny to end the day at 164.05p and the day ahead contract adding a penny to finish at 159.05 a therm. UK LNG facilities are scheduled to receive 9 vessels for the period from November 26th to December 4th. This represents an increase of 4 compared to the same period last year.
GB Baseload futures added further premium on Friday
GB Baseload futures added further premium on Friday to make sizeable gains for the week on the near end of the curve. The front month of December added £14.50/MWh to settle at £309.75/MWh, up £43.75/MWh on the week. UK temperatures are forecast to remain at seasonal levels for the week while wind generation is anticipated to be 20% below seasonal averages increasing pressure on gas for heating requirements. Day ahead baseload contracts surged £99.95/MWh to end the session at £240.00/MWh on Friday amid low wind production forecast for the week. Carbon prices remained steady with the December 2022 EUA contract up just €0.11 to €78.80 a tonne.
Brent crude oil remained stable in a subdued trading session
Brent crude oil remained stable in a subdued trading session on Friday as US markets reopened after Thanksgiving. The surging coronavirus outbreak in China continues to trigger further lockdown restrictions in the world’s biggest importer, with hopes of a demand recovery fading. The impact of the weakening Chinese demand continued to play on the market on Friday as brent crude futures experienced a third weekly drop. Crude oil prices for the front month of January shed $1.71 to settle at $86.63 a barrel while West Texas Intermediate fell $1.66 to end the week at $76.28 a barrel.
GB gas system has opened significantly undersupplied
The GB gas system has opened significantly undersupplied this morning with a deficit of 27.60MCM against a demand of 328.80MCM. Early trading this morning has seen premium taken out of the market, with the front month of December last trading at 281.25p a therm a drop of 7.21p on Friday’s close. The Q123 and Summer 2023 contracts have also traded lower this morning at 311.00p and 296.25p a therm respectively. Crude oil prices have also eased this morning with Brent for the front month of January last trading down $2.47 at $81.16 a barrel. On the spot the within day contract has opened firmer as lower wind generation is forecast for the week as seasonally average temperatures are set to return.