NBP curve products retraced the previous days’ gains and more on Wednesday, with near months falling by an average of 2.2% day-on-day

Gas Market

After initially posting gains in early morning trade, NBP curve prices began to fall back, with near months eventually settling 2.2% lower than their previous close. The front month contract declined by 2.69p day-on-day to settle at 110.22p per therm. The prompt market was similarly weak, with a milder weather outlook for much of the remainder of December weighing on prices. The Within day contract was unperturbed by an undersupplied system on the day, falling by 2.08p to close out the day at 110.50p per therm. The Day ahead contract also shrugged off fundamentals such as increased gas-for-power demand levels and Norwegian maintenance outages, which would usually be supportive, to post a 2.40p decline to settle at 110.20p per therm.  

Power Market

Near curve losses on the NBP gas market resulted in corresponding weakness on GB Baseload contracts on Wednesday. The January-25 contract shed £1.65/MWh to end the day at £95.50/MWh. The average loss on the near months was £1.25/MWh day-on-day. A further downward revision to wind generation levels supported the prompt market, with the Day ahead contract increasing by 6.4% to close at 192.50/MWh. In contrast to the losses across the gas and power markets, European carbon prices strengthened on Wednesday as the market focused on the impending expiry of the December options contract. The EUA Dec-24 contract gained 34 cents day-on-day to settle at €68.69 a tonne.  

Oil Market

Crude oil prices gained ground on Wednesday after the European Union agreed a further package of sanctions against Russia which could tighten global oil supplies. In what will be the 15th package of sanctions against Russia over its war on Ukraine, their shadow fleet will be targeted which is expected to prohibit Russia from bypassing the $60.00 a barrel price imposed by the G7 on their seaborne crude oil. Gains were limited however after OPEC+ cut its forecasts for demand growth in 2025 in what was the fifth consecutive monthly report in which demand growth has been lowered. Front month Brent gained $1.33 day-on-day to settle at $73.52 a barrel.  

Markets this morning

NBP prices have continued to shed value into this morning, with the front month contract last going through at 108.64p per therm, down 1.58p on Wednesday’s close. Fundamentally the market remains largely unchanged day-on-day with price direction focusing on the milder weather forecasts and expectations of lower demand levels heading towards the holiday season. The GB system is well supplied this morning, although its influence on the Spot market is yet to be seen, with activity on the prompt yet to get going. Crude oil prices are stable this morning after yesterday’s gains, with the front month Brent contract last going through at $73.77 a barrel, up 25 cents on the previous close.