Gas Market
The news that the Austrian gas supplier, OMV, intends to recoup damages of €230m plus costs from Gazprom by nonpayment of invoices sent the gas markets reeling yesterday. The arbitration was awarded on Wednesday and the market fears Russian gas supplies will be cut if OMV suspend payments. The volume of imported gas to Austria equates to a maximum of 16mcm per day and the supplier has stated they have already put contingencies in place should Gazprom stop gas flows. The 20-November is the date the next monthly payment is due to Gazprom so the markets could remain on edge until Gazprom’s reaction is clear. Near NBP months settled around 5.90p higher while contracts for next summer and winter added 4.91p and 3.47p respectively. Prompt prices also rose sharply with planned maintenance at St Fergus set to curtail imports until early December.
Power Market
The bullish movement witnessed on the NBP curve added premium to the baseload futures yesterday. Near months were marked £3.85/MWh up while the Summer-25 contract was assessed £3.72/MWh higher. Forecasts for wind speeds have improved and the Day ahead contract eased on the day but losses were limited by gains on its counterpart on the NBP prompt. Wind generation is expected to nearly double Thursdays supply of 4.5GW.
After three days of declines, carbon prices posted significant gains yesterday as the Spot for EUAs set a fresh 11-week high. EUAs for 2025 gained €2.06 to settle at €70.46 per tonne. UKAs for 2025 closed at £40.21 per tonne up £0.56.
Oil Market
Brent for January delivery posted its third gain in succession on Thursday albeit, the increases have been modest, and the global benchmark could be on for a decline this week. U.S. crude oil stocks grew by 2.1m barrels last week but it was the large draw down of gasoline reserves that took the market’s eye yesterday. The Energy Information Administration’s weekly oil report delayed a day, due to Veterans Day earlier in the week, showed U.S. gasoline stocks were at a two-year low after a 4.4m barrel draw gave hopes of increasing demand. The International Energy Agency increased its forecast for 2024 global demand growth by 60,000 barrels per day to 920,000 bpd but this was because it’s base for 2023 was lowered and still remains well below the recent OPEC forecast.
Markets this morning
After yesterday’s sharp gains, the gas markets are a little calmer this morning and NBP futures contracts across the board are showing declines. The front month is trading close to it’s low for the day at 115.31p per therm while near months are generally just over a penny below last night’s close. The prompt screen is showing no trades at this point, but the GB gas system is comfortable and showing a modest surplus against todays demand of 221mcm. Carbon EUAs have eased this morning too with the Dec-25 contract having shed €1.17 per tonne so far. Brent has also weakened overnight, and the last exchange for the January contract has gone through at $71.89 a barrel.
15 November 2024
