Crude oil prices were over two dollars a barrel higher on Monday

11 June 2024

Gas Market

Yesterday’s early losses of around 2.00p per therm were reversed during the afternoon session as prompt and near futures were supported by gains on the TTF and higher U.S. gas prices.  Dutch gas prices were spurred on by reports of an unplanned outage at Norway’s Visund field which will curb flows to the Netherlands by up to 16mcm for the next week. European gas prices were also supported by higher U.S. natural gas prices when that market opened as forecasts for warmer weather are likely to raise demand for power generation. The front month for the NBP went on to recover Friday’s losses and settled 2.91p higher at 81.32p.  The Winter-2024 contract added 2.46p to close at 98.96p.  Prompt prices were also bullish in the afternoon and the Spot and Day ahead products added 4.05p and 5.15p respectively despite a comfortable GB gas system which operated with a surplus for the whole session.

Power Market

Weaker carbon prices tempered the gains to GB baseload futures on Monday after a late rally on the NBP futures market.  The front month for baseload power added £1.68/MWh while the September contract was assessed £2.13/MWh higher as trading activity was focused on the front month and season. Carbon EUA contracts out to 2026 eased by an average of 44 cent per tonne yesterday while the 2024 UKA contract declined by £0.66 per tonne. Wind forecasts for the remainder of the week are above the seasonal average and weighed on the power prompt yesterday.  Baseload for the day ahead eased by £2.10/MWh as wind generation is expected to get close to 10.0GW on Tuesday.    

Oil Market

Crude oil prices were over two dollars a barrel higher at the close of play on Monday as the market was bullish about U.S. demand. The Energy Information Administration will release last weeks inventory report on Wednesday and the market is expecting to see declines in U.S. stocks after the commencement of the summer driving season at the end of May.  Brent fell by $2.01 a barrel for the August contract while the July contract for WTI shed $2.21 a barrel despite a stronger dollar on the day.  The greenback made gains against a basket of currencies yesterday as the Euro wobbled after the French President called a snap general election following disappointment in the European Parliament elections at the weekend.  

Markets this morning

The GB gas system is forecast 10mcm long for today against the demand of 146mcm however the prompt is marginally higher with the Day ahead last trading at 84.00p per therm.  NBP futures are struggling to find direction this morning with trades for the front months on either side of last night’s close. The latest trade for July was at 82.25p which is just less than a penny of a gain.  In the wider energy markets, carbon EUAs are around €1.10 per tonne higher in early exchanges while crude oil prices are slightly down with the last trade for Brent going through at $81.58 a barrel.