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 prices weakened on Thursday thanks to a positive supply/ demand outlook and a falling coal market. Mild weather is expected to weigh on residential demand, while the return of the Nordstream pipeline has improved supply levels on the continent. An extension to the Kollsnes outage restricted losses on the prompt, with another planned outage also scheduled at Karsto next week.
According to new research, the UK’s oil and gas reserves could expire in 10-years’ time, which would result in a 100% reliance on foreign imports.
An improved supply outlook and a milder weather forecast weighed on near-curve gas contracts yesterday. The Langeled pipeline returned following a 1-day shutdown and above-average temperatures should reduce demand levels, weighing on prices, with a comfortable European LNG outlook also a factor. Further out, a sharp drop in coal prices offset the impact of bullish oil.
Movement along the gas curve varied yesterday with a lower demand outlook for the rest of the week applying bearish pressure on the prompt. Norwegian imports were reduced due to a shutdown of the Langeled pipeline but the facility has returned online today. However, an outage at Kollsnes has been extended till Friday, offering support to the rest of the near-curve.
Gas prices displayed mixed movement yesterday as cold weather lifted demand and Norwegian supply was limited, resulting in a short system. Reduced wind generation contributed to an increase in CCGT demand which added to the undersupply. However, the outlook for later in the week is healthy and this helped to restrict the gains, while weaker coal and oil weighed on the far-curve.