Significant increases were seen across the NBP prompt on Monday, with the Day ahead contract closing at its highest level since December 2023

Gas Market

Gains across the NBP prompt were strong on Monday, driven by an unplanned outage the Gullfaks platform in the North Sea which could potentially limit Norwegian gas flows into the U.K. Cooler than normal temperatures forecasted for the majority of the rest of the month also added to the upside, pushing the Day ahead contract up by 8.70p to close at 88.20p per therm, its highest close since December 2023. The front month contract also exhibited gains, supported by concerns over the level of supply maintenance taking place in September, particularly that of a full shut down of the Langeled pipeline. While the rest of the curve settled below their previous close, September-24 finished the session up by 0.85p to close at 96.13p per therm. European storage sites are currently at 89.5% fullness, which likely limited the influence of the prompt and front month’s upside over the rest of the curve.

Power Market

GB Baseload for September delivery followed the upside on the NBP front month on Monday, increasing by £1.20/MWh to settle at £82.45/MWh. Movement across the rest of the curve was relatively flat day-on-day as most contracts gave back the modest gains produced during Friday’s session. In contrast, the Day ahead contract was pressured down by strong wind forecasts for the rest of the week, falling by £19.70/MWh day on day to settle at £50.67/MWh. European carbon prices settled at their highest close in 11 weeks on Monday, with the EUA Spot finishing the session at €72.14 a tonne, up €0.71 day-on-day. UK Allowances were more stable, with the Dec-24 contract increasing by just £0.01 to close at £40.90 a tonne.

Oil Market

Crude oil prices eased further on Monday as concerns over China’s demand levels continued to weigh on the market. Data released recently showed that Chinese refineries sharply cut crude processing rates in July on muted demand levels, while the approaching end of peak driving season in the U.S. added further downside. Front month Brent fell by $2.02 to settle at $77.66 a barrel, its lowest close in almost two weeks. The market is remaining tentative however to the ongoing conflict in the Middle East as well as the Russian-Ukraine war in terms of their potential to create any supply disruptions and subsequent price support.  WTI for September delivery shed $2.28 to settle at $74.37 a barrel, down just under 3% day-on-day.

Markets this morning

The NBP curve is trading in negative territory this morning, with the September-24 contract last going through at 95.78p per therm, down 0.35p day-on-day so far. Having operated in a short position for much of yesterday, the GB system is currently well supplied at 5mcm long. The unplanned outage at the Gullfaks facility reported yesterday is expected to be resolved today which should add a further level of supply comfort to the prompt market, although activity there is yet to get going. Crude oil prices continue their downward trend this morning on easing geopolitical risks. Front month Brent last traded at $76.96 a barrel, 70 cents lower than Monday’s close.