Apollo Energy publishes a daily energy market analysis, focusing on the gas, power and oil markets including a commentary on how the markets close and open. Our analysis provides insight on how the markets are performing and also considers various factors which could dictate price changes in the future.
The analysis also contains a graph which tracks the one-year forward price of both gas and electricity as well as changes to Brent crude oil.
The Dutch government has announced that it will cut production at the Groningen gas field to 12 billion cubic metres (bcm) per year by 2022, with extraction at the site completely halted by 2030.
Supply concerns pushed gas contracts higher yesterday afternoon as colder temperatures are forecast for next week, while storage levels remain low. An announcement is also expected from the Dutch government on Thursday in regards to further production cuts at the country’s largest gas facility in Groningen. Meanwhile, coal prices displayed a strong rebound due to a potential miner striker in South Africa, supporting contracts at the back of the curve.
The supply/ demand outlook looks healthier for the Easter weekend as the predicted cold spell (Beast from the East 3) is now looking unlikely, with temperatures forecast to be around the seasonal norm. This helped near-curve gas contracts shed from their price, with healthy LNG send-outs also a factor. Far-curve contracts decreased in the afternoon but losses were limited by higher oil prices.
Near-curve gas prices inched lower on Friday as temperatures for the week ahead continued to be revised higher. A weakening Asian market also transferred to European prices, while LNG deliveries could ramp up in the coming weeks. Further out, contracts largely held their price with bullish resistance provided by a strengthening oil market.