Unplanned outages at Nyhamna and Gullfaks led to supplies tightening on Friday

Gas Market 

Unplanned outages at Nyhamna and Gullfaks led to supplies tightening on Friday after early forecasts for a long gas system.  The outages impacted supplies to the UK and Europe but were expected to be resolved over the weekend according to Gassco, the Norwegian Gas Operator.  Prompt prices opened softer but ended the session with modest gains as the Spot settled 0.45p higher while the Day ahead added 1.80p.  Near months for the NBP were lifted by the prompt while strong gains to carbon supported contracts from the winter out. The May contract settled 1.24p up at 66.08p on Friday but over the week the front month was 3.68p down. The Winter-2024 contract added 1.54p on Friday cutting the week’s loss to 1.06p.  The outlook for the week ahead remains positive with temperatures expected to be around the norm or above while wind generation should remain above seasonal averages.  

Power Market

GB baseload futures settled higher on Friday after strong gains to carbon combined with higher gas prices to lift the curve.  The May contract settled £1.55/MWh up on Friday but still was £1.95/MWh down over the week.  The Winter-2024 contract also added £1.55/MWh on Friday and closed at £75.70/MWh.  Forecasts for strong wind generation for the weekend pressured weekend baseload prices which settled at just £6.75/MWh. Carbon prices rose sharply on Friday supported by a late frenzy of buying activity.  The Spot for EUAs settled €2.38 higher at €59.25 per tonne.  EUA contracts for 2024 and 2025 added 4.4% gaining €2.62 per tonne on average.  

Oil Market

Crude oil prices continued to firm on Friday as tensions remained high following Iran’s vow for revenge for the bombing of the Iranian embassy compound in Damascus earlier in the week.  Israel is believed to be preparing for a retaliation and the markets are concerned oil supplies could be disrupted in the Middle East. Fridays increase of 52 cents to Brent brought the weeks gain to $4.17 a barrel and is the second week in succession for crude oil prices to climb. Russian refinery capacity is down by around 15% after Ukraine drone attacks which have targeted energy infrastructure last week.  Also adding support to crude oil prices last week was OPEC+, the group left its oil supply policy unchanged last week.  

Markets this morning

Processor issues have caused an unplanned outage at the Asgard gas field this morning while planned annual maintenance works are due to start at several Norwegian gas plants today.  The UK gas system is operating in equilibrium despite this, and today’s demand is pitched at 190mcm. Gas prices are flat this morning with near months currently exchanging just below Friday’s close while the winter contract is slightly up on the last trade.  Carbon prices have opened softer and in the crude oil markets, Brent is down by 68 cents to $90.49 a barrel.