UK gas prices extended gains for the second consecutive session
UK gas prices extended gains for the second consecutive session on Wednesday. However, prices continued to trade well below the previous price spike in December and it remains unclear on where the market will go at the point of delivery for future dated contracts. Strong liquidity was evident for the NBP front month contract, as buying activity pushed the contract up 3.14p to settle at 153.88 pence per therm. Further along the curve contracts kept a similar pace, with the bellwether contract Summer 23 pushing 3.08p higher to end the day at 158.81 pence per therm. Robust demand on the back of the cold weather supported the prompt market once again yesterday, with the Within day and Day ahead contract gaining 11.00p and 13.50p respectively.
GB baseload power contracts continued to take a marginal step higher
GB baseload power contracts continued to take a marginal step higher yesterday, for the second consecutive session. The uptick in NBP gas price filtered into the market, with the front month contract February gaining £4.50/MWh to settle at £160.50/MWh. Gains further along the curve followed a similar pattern, as the front season edged £4.00/MWh higher to close at £149.50/MWh. GB baseload power market also took direction from a bullish carbon market, as the EUA Dec 23 contract jumped €4.09 to settle at €83.59 a tonne. Baseload for day ahead delivery fell £3.61/MWh to settle at £135.59/MWh.
Prices turned negative in the late afternoon
Brent crude oil hit $86.36 a barrel during Wednesday’s session before falling back to settle down 94 cent at $84.98. The bullish sentiment in the early hours of trading took direction from the possibility that global powerhouses may avoid recessions. Germany, the largest economy in Europe will avoid a recession this year according to the countries leader Olaf Scholz who spoke at the World Economic Forum Meeting in Davos yesterday. However, prices turned negative in the late afternoon as an unexpected jump in US crude stock coupled with disappointing US retailed sales data pressured the market. WTI front month also eased early gains to end the day at $78.57 a barrel, down 1 percent.
Brent crude prices have pushed lower once again
The marginal increase in UK gas prices has continued this morning, with the front month contract February currently trading at 156.00p up 2.12 pence per them while bid offer spreads remain tight. As the UK system has opened relatively balanced it is unclear if the UK prompt market will hold onto yesterday’s gains, the Within day contract is yet to trade while gas for day ahead delivery is currently trading at 162.97 pence per therm up 2.97p. Brent crude prices have pushed lower once again this morning, with the front month contract trading at $84.19 a barrel.
19 January 2023
