Gas Market
Activity across the NBP curve was choppy during Monday’s morning session before the bulls took a firmer hold of direction. Having initially traded below the previous close, the November-24 contract posted a day-on-day gain of 1.49p to close at 100.86p per therm. Further out, gains were less pronounced, with weak crude oil prices limiting increases on the far curve. The GB system remained undersupplied throughout the day. An unplanned outage at the Norwegian Oseberg facility was expected to reduce flows into the UK until Tuesday morning, while the Kristin production field was struggling to ramp up after its planned maintenance period, but is also expected to return on Tuesday. The Within day contract increased by 0.70p, while Day ahead posted a gain of 0.25p, proving that prices remain sensitive towards any supply disruption, despite an otherwise healthy supply outlook.
Power Market
GB Baseload curve contracts tracked the upward movement across the NBP gas market on Monday. A tight power supply system which triggered a UK capacity market notice also exacerbated the upside. The front month contract posted the biggest gain of the day, increasing by £2.38/MWh to settle at £87.63/MWh. Wind output for the rest of the week was revised down but remains within the normal range.
Following the upside across the NBP gas market, European carbon prices resumed their upward trend on Monday. The EUA Dec-24 contract climbed €1.07 to finish the day at €65.87 a tonne, while UK Allowances for Dec-24 increased by £1.37 to close at £38.88 a tonne.
Oil Market
Crude oil prices were in decline on Monday as China’s stimulus plans failed to inspire confidence among investors, while OPEC once again lowered its demand outlook for 2024 and 2025. China’s deflationary pressures worsened in September according to official data released over the weekend which has stirred the latest downturn. Front month Brent fell by $1.58, with the contract down by 4.6% week-on-week. The bleak demand outlook was enough to stave-off the ongoing market uncertainty surrounding potential Israeli attacks on Iranian oil infrastructure, with prices likely to remain volatile until the situation in the Middle East is clearer. Front month WTI followed a similar trend to Brent, with the November contract shedding $1.73 to settle at $73.83 a barrel.
Markets this morning
Contracts across the NBP are this morning trading below their previous close, with November-24 last going through at 97.27p per therm, 3.59p lower day-on-day. Prompt prices are also in negative territory, despite a short system, as rising temperatures ease demand levels. The Within day contract was most recently observed at 96.00p per therm, down 1.75p on Monday’s close. Crude oil prices are down by over 4.0% this morning, with front month Brent last going through at a $3.36 a barrel discount to its previous close. Media reports suggesting that Israel has agreed to avoid targeting Iranian oil infrastructure appears to be driving the downside.
15 October 2024
