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.
27th November 2017 | Posted by: Stephen Berrey | Market Analysis
There was a significant increase in European gas prices on Friday, both on the spot and on the curve. This was on the back of rising demand due to colder weather. Additional support was provided by bullish oil and coal prices.
Near-curve gas prices increased to their highest levels since February as temperatures are set to turn cold next week, increasing demand levels. The prompt found additional support from an extension to the outage at Oseberg in Norway, while the LNG outlook also remains weak. Meanwhile, coal prices strengthened, assisting prices further along the curve in moving higher.
A drop in coal and mild weather helped to exert bearish pressure across the gas curve yesterday afternoon. Temperatures remained above average yesterday and were forecast to stay mild today, reducing LDZ demand. Wind levels were also set to increase today, meaning less reliance on gas-fired power generation.
Gas prices moved higher yesterday, with a colder weather outlook dictating movement on the near-curve and stronger fuel markets supporting contracts at the back of the curve. The system was long despite maintenance in Norway and healthy wind reduced CCGT demand, limiting gains on the prompt.