Near futures on the NBP racked up a third day of losses

The prompt responded to forecasts for temperatures to increase

The gas markets across Europe and the UK shrugged off the cooler temperatures yesterday and continued to decline.  Near futures on the NBP racked up a third day of losses with contracts out to the summer shedding around 5.00p on average.  The March contract settled at 134.61p, the lowest price for the contract in 14 months and down 713.49p from it’s high on 26-Aug-22. GB gas demand exceeded 310MCM yesterday as heating load increased on the day, but the gas system was in balance despite supply issues impacting Norwegian feeds.  The prompt responded to forecasts for temperatures to increase at the end of the week while high wind generation should also limit demand and the spot and day ahead shed 3.60p and 4.47p respectively.

 Carbon EUAs fell in value yesterday

The outlook for mild temperatures dominated the energy markets across Europe yesterday and GB baseload ended the day with losses too.  The near curve tracked gas futures on the NBP down but declines on the day were kept to around £2.50/MWh to £4.00MWh with March closing at £140.00/MWh.  Carbon EUAs also fell in value yesterday, but declines were more modest than during the previous sessions. Baseload for the day ahead bucked the trend of the day and settled £3.69/MWh higher.  While wind generation is forecast above 10.0GW for Thursday it will be below the average recorded over the last week.

The crude oil markets continued to recover on Wednesday

The crude oil markets continued to recover on Wednesday with prices buoyed by hopes that the U.S. Fed will scale back on interest rate increases after recent remarks by Jerome Powell and by an expected demand surge in China.  The International Energy Agency, based in Paris, reported earlier in the week that it expects China’s oil processing to rise to a record 14.4m barrels per day in 2023 which is a significant increase over 2022 of 13.6m barrels per day. Monday’s earthquake on the boarder of Turkey and Syria has halted oil flows through the Baku-Tbilisi-Ceyhan pipeline has also added some upside to prices yesterday.  At the close, Brent for April delivery was $1.40 higher at $85.09 a barrel.

Early activity on the NBP has seen near futures and the prompt rise

Early activity on the NBP has seen near futures and the prompt rise from last night’s close.  Trading has been thin thus far but near months are around 2.50p up on average with March last exchanging at 137.50p. The spot and day ahead are 3.95p and a penny higher respectively.  With temperatures dropping overnight, GB gas demand is forecast a touch higher at 319MCM for today, and supplies are lagging by less than 5MCM according to the national Grid’s website.  In the crude oil markets, the April contract for Brent is up 14 cents at $85.23 a barrel.  

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