NBP futures market settled mixed after a choppy day of trading

Gas Market

The return of gas from Norway continued to weigh on the near curve on Thursday although prices for contracts out to next summer traded in positive territory earlier in the session.  The losses recorded yesterday were minor compared to the declines over the first three days of the week and its normal for the market to pause after such declines.  Works at the Nyhamna plant are on schedule for completion at the weekend and nominations through the Langeled feeder to the UK were up to 9mcm yesterday.  At the close, the August contract was just 0.33p lower at 64.46p and the Winter contract settled at 114.37p, shedding a half a penny. On the prompt, the Spot and Day ahead products posted losses of 0.88p and 1.00p respectively while forecasts for higher gas demand next week may offset some on the increased supplies from Norway.

Power Market

GB baseload futures settled mixed after Thursday’s session with contracts from the winter out closing a touch higher.  The August contract also settled up on the day and closed with a gain of £0.70/MWh as the market tracked the swings in trading on the NBP curve.  Carbon EUAs remained flat with the Spot closing at €84.23 per tonne while the Dec-23 contract settled at €85.89 per tonne. Baseload for the day ahead declined with wind forecasts to remain steady at around 5.0GW into the weekend but expected to fall off for the week ahead.  At the close the Day ahead product was £11.00/MWh down at £72.65/MWh.

Oil Market

A weaker dollar boosted crude oil prices on Thursday as Brent settled at its highest level in almost three months.  There were signs that the U.S. monetary policy may be working yesterday with the latest data for U.S. consumer prices registering the smallest annual increase in over two years.  This weighed on the dollar and in turn propped up crude oil prices on the day as a weaker dollar makes crude oil less expensive for other currency holders.  It was the third day of gains in a row for crude oil and prices have generally been buoyed for the last two weeks since Saudi Arabia and Russia announced supply cuts.  At the close of play, Brent for September delivery was up $1.28 to close at $81.39 a barrel, while West Texas Intermediate settled at $76.89 a barrel, adding $1.14.

Markets this morning

Increased buying activity has seen near futures on the NBP tick up this morning as the August contract last traded at 69.39p, up 4.93p.  The lesser traded Winter-23 contract has added 6.13p to 120.50p.  Prompt prices are unchanged thus far and the National Grid is showing the gas system operating with a slight deficit against today’s demand of 132mcm.  Langeled nominations have increased to 15mcm for today as maintenance works at Nyhamna are due to wind up this weekend.  The September contract for Brent has eased this morning, last exchanging at $81.25 a barrel.    

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