The front month for the NBP is down over 2.00p this morning

Gas Market  

A combination of low wind forecasts and planned maintenance works which are expected to curb Langeled gas flows to GB provided the support to prompt and near curve contracts on Friday.  Langeled is the main gas line for Norwegian imports and scheduled maintenance could see gas flows fall close to zero for the next week or two, meanwhile gas demand is set to rise to compensate for a loss of wind generation in the power stack for the coming week. The Day ahead product added 2.30p per therm while the week ahead settled at 93.05p with a similar increase.  October assumed front month status for the NBP and gained almost 2.00p, closing at 96.15p which 5.63p up for the week. The Winter contract was 3.80p higher for the week and 1.69p up day-on-day.  

Power Market

Unplanned outages at two nuclear plants in the UK along with forecasts for lower wind supported power prompt on Friday. The Day ahead product settled at £89.00/MWh, its highest level since the second week in January. Gains witnessed on the NBP curve fed into baseload futures on the day as the September contract expired at £81.85/MWh with a gain of £1.22/MWh. The Winter-2024 contract added £0.92/MWh and settled at £93.00/MWh. In the carbon markets there was another fall in EUAs while UKAs continued to climb to a fresh seven-week high. The Spot for EUAs declined by 82 cent per tonne to €69.40 while UKA contract for Dec-24 & Dec-25 added 2.7% or £1.20 per tonne.  

Oil Market

Crude oil prices came under pressure on Friday after OPEC+ confirmed the planned production increase will go ahead in October despite a fall in output from Libya.  OPEC has committed to start unwinding the voluntary cuts (2.2m barrels per day) from October with members set to increase production by 180,000 barrels per day. Some member states like Iraq will reduce output in the short term to compensate for exceeding earlier production quotas.  An increase in U.S. consumer spending for July has raised questions as to how much the Fed will reduce interest rates by in September.  There were hopes that a half a percentage point decrease would be announced.  October for Brent fell by $1.14 a barrel while the more heavily traded November contract shed $1.89 a barrel.  

Markets this morning

The Spot has shrugged off a short system this morning and is 1.10p down from Friday’s close.  The System is only 3mcm down, but demand is also lower than expected at 130mcm. Nominations through the Langeled feeder are down to zero this morning due to the scheduled Norwegian maintenance works.  On the curve, the front month is down over 2.00p to last trade at 94.08p while the Winter-2024 contract is just over a penny lower at 104.95p.  The November contract for Brent is flat at $76.95 a barrel, but weak economic data from China could weigh on prices later.