UK gas markets have opened with some downward movement

Prices slumped later in the session yesterday

Early indications of another upward run in NBP gas futures contracts proved to be premature as prices slumped later in the session yesterday. Contracts for the front month of January traded as high as 396.52p before the late sell off saw prices fall 24.90p settling at 349.59p a therm. The volatility was also observed on the spot which traded as high as 400.00p, but by the end of the day stood at 345.55p a therm a fall of 29.5p. Despite the late sell off on the NBP futures contracts yesterday, prices remain relatively unchanged over the five-day period. An unplanned outage at the Norwegian Oseberg facility reduced export capacity by some 44.00MCM increasing offline capacity to 53.00MCM on Thursday. Norwegian operators expect to reductions of 40.00MCM to continue for Friday.

Carbon prices tipped slightly higher

GB baseload power futures took direction from movements in the NBP gas market and pushed lower on Thursday. Contracts for the front month of January shed £22.45/MWh to settle  at £477.30/MWh, over the past five days of trading the contract has fallen £67.95/MWh. Further out the summer 2023 contract dropped £20.75/MWh to end the day at £304.00/MWh. The baseload day ahead contract jumped £27.00/MWh to finish the day at £391.50/MWh as wind generation forecasts remain below seasonal averages. Carbon prices tipped slightly higher with the December 2022 EUA contract rising €0.60 to €88.67 a tonne.

Late sell off saw prices fall for a fifth consecutive day

Crude oil markets traded higher for much of the session yesterday before a late sell off saw prices fall for a fifth consecutive day. Contracts for a February delivery shed $1.02 to end the day at $76.15 a barrel. Chinese crude imports for November rose 11.80% year on year as refineries in the world’s largest importer stepped up production. However, despite some optimism surrounding the Chinese demand following changes to its anti-covid response, widespread expectation of economic recessions in both the US and Europe have seen demand forecasts falter.

Brent crude prices have so far moved marginally higher

UK gas markets have opened with some downward movement in early trading today. Although multiple contracts are yet to trade, the front month of January most recently traded at 346.00p a therm, a decline of 3.59p. Meanwhile the summer 2023 contract is also down, last trading at 352.00p a therm. Brent crude prices have so far moved marginally higher with contracts for a February delivery trading up $0.39 at $76.55 a barrel. There has been no trading recorded on the within day so far this morning, although the day ahead most recently traded at 355.00p a rise of 10.30p.  The UK system has opened with an undersupplied position of 8.50MCM against a high demand of 371.70MCM forecast.  

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