The NBP futures market opened firmer

Gas Market

After two days of volatility the NBP futures market was more benign on Friday as movement on the day was within a penny either way save for the two front months.  The markets rose sharply on Wednesday on the back of news that Australian workers at key LNG facilities threatened strike action raising fears that LNG tankers may be diverted to the East. On Friday, the labour regulator cleared the way for a ballot for strike action. The September contract eased by 4.83p on Friday to close at 89.42p which left the five-day movement at 16.49p. The winter contract eased by just 0.30p to 127.29p and is 10.77p higher over the week.  Prompt prices reacted to the increased wind generation which has dented demand for gas fired generation and the Spot shed 9.10p while the Day ahead for Monday closed 7.00p lower.

Power Market

The movement on the GB baseload power curve mirrored that of the NBP curve on Friday with gains and losses generally within £1.00/MWh apart from the odd exception.  The lead month, September eased by £1.80/MWh to close at £86.70/MWh while the Winter-23 contract moved just £0.25 down to £119.50/MWh.  Carbon EUAs recovered on Friday with contracts out to 2025 adding over 2.00% as Dec-23 closed at €86.78 per tonne. Baseload for the Day ahead edged higher on Friday as forecasts for wind generation is to fall below the seasonal average.  The contract settled at £88.00/MWh on Friday, up £5.19/MWh from the previous close.

Oil Market

Crude oil prices settled higher on Friday after the latest report from the International Energy Agency which forecast record global demand and tighter supplies over the months ahead.  The IEA, based in Paris, estimated June global oil demand at a record 103 million barrels per day and they believe this could be surpassed this month. This came on the back of OPEC’s latest monthly report in which they stated the 2023 oil market would remain healthy and left their forecast for demand for the year unchanged.  The gain of 41 cent a barrel for Brent on Friday saw the global benchmark rack up it’s seventh weekly gain in a row as the October contract closed at $86.81 a barrel.  The U.S. benchmark settled at $83.19 up 37 cents a barrel.

Markets this morning

The NBP futures market opened firmer this morning with the front month peaking almost 5.00p higher at 94.16p, however, latest exchanges have seen some of the early premium being reversed.  The September contract last traded at 90.43p which is around a penny above Friday’s close and is typical for most of the futures that have traded so for.  Prompt prices are touch higher too with GB gas demand picking up as wind generation falls off however supplies are matching demand at 162mcm.  In the crude oil markets, prices have softened with Brent down 35 cents to $86.46 a barrel.

 

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