Gas Market
Monday’s losses were mostly retraced on Tuesday with near months posting an average gain of 3.70p per therm. The front month traded a wide range of just under 5p, hitting an intra-day high of 85.54p per therm shortly before the close, before ticking back down to settle at 85.21p per therm. An escalation of tensions in the Middle East fed into the gains across the curve while news of Russian attacks at the Sumy region close to the Ukrainian gas transit pipeline provided some additional price risk. The prompt and Spot followed a similar trajectory on the day, with Within Day posting a 2.10p gain to settle at 83.50p per therm, while Day ahead increased by 2.20p to end the session at 83.60p per therm.
Power Market
GB Baseload curve contracts continue to follow the trend set by the NBP, with the majority of futures posting day-on-day gains on Tuesday. The October-24 contract increased by £1.84/MWh to end the day at £70.73/MWh, while the Winter-24 contract closed at £81.40/MWh, up £1.40/MWh on the previous close. In contrast, the Day ahead contract posted a loss of £3.68/MWh on stronger than expected wind forecasts.
Carbon markets rebounded from multi-month lows seen during the previous session as stronger gas markets provided support. Dec-24 EUAs closed at €64.24 a tonne, up 93 cents day-on-day. Similarly, Dec -24 UKAs posted a £0.98 gain to close at £40.60 a tonne.
Oil Market
Crude oil prices made further gains on Tuesday as ongoing fears of weaker demand in China were at odds with prospective lower U.S. crude stockpiles and concerns over U.S. crude output due to Hurricane Francine. More than 12% of crude output along the Gulf of Mexico remains offline due to the recent adverse weather in the region. Prices found further support from renewed tensions in the Middle East also. However, the markets’ biggest focus remained on the U.S. Federal Reserve’s policy meeting taking place today. The extent of the expected rate cuts could determine how strongly oil prices respond to the outcome. Front month Brent increased by 95 cents to close the session at $73.70 a barrel, while WTI for October-24 delivery posted a $1.10 gain to finish at $71.19 a barrel.
Markets this morning
Direction is mixed across the NBP curve this morning with October-24 last going through at a 2.08p discount to Tuesday’s close, while the February-25 contract was last observed at 99.48p per therm, flat day-on-day. The GB system is currently well supplied at 24.8 mcm long with strong flows coming from Norway via the Langeled pipeline. A ramp up in maintenance at the Kollsnes facility from tomorrow could support the Day ahead product, although stronger winds may mitigate the upside. Crude oil prices have eased this morning on news of increasing U.S. crude and fuel inventories, which has offset the effects of rising tensions in the Middle East. Front month Brent last traded at $72.81 a barrel, down 89 cents day-on-day.
18 September 2024
