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.
Gas contracts continued to climb higher on Thursday as cold weather remained the main market driver. Below average temperatures are forecast across Europe in the coming days, tightening supply levels. Meanwhile, oil and coal markets recovered, providing additional support at the back of the curve.
Sentiment on the near gas curve remained bullish yesterday due to the impending cold spell which will increase demand levels and tighten the system. There was some uncertainty with regards to how long the cold spell will last, helping some contracts hold their price, while a drop in coal applied downward pressure to far-curve contracts.
The expected rise in demand in the coming weeks continued to provide upward pressure at the front of the gas curve yesterday, with an extended outage in Holland also assisting the bulls. Norwegian flows were also down due to an unplanned outage. Meanwhile, far curve contracts displayed minimal changes as coal and oil markets stabilised.
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Yesterday’s weather forecasts pointed towards cold temperatures for a 2-week period, starting from the end of this week; this will increase residential demand and resulted in gains at the front of the gas curve. LNG send-outs to Europe are also lower, providing additional support, while the far-curve was pushed higher by rising coal and oil.