Spot power prices have recorded gains this morning as temperatures are expected to turn colder and wind and solar production is down. However, wind generation levels will still remain comfortable and demand levels are not expected to rise significantly as a result of the Easter holidays. Gas prices displayed gains on Wednesday as a result of an under-supplied system and an expected drop in temperatures. The UK gas system remains short today as an outage in Norway has restricted flows via the BBL pipeline, while LNG send-outs are also lower. Today's prices can also be found in an easy to read table on our 'current UK energy price' page.
How did the energy markets close?
The gas curve was pushed higher yesterday by a combination of colder temperatures, a drop in supply and rising Brent. Demand levels were expected to be slightly below average for the majority of April which helped front-month close at a premium. Power prices also displayed gains with stronger gas and carbon contracts the influencing factors. A rise in heating demand is also expected this month which helped near-curve contracts climb higher, while seasonal contracts displayed smaller gains.
How did the energy markets open?
Near-curve gas prices continued to rise this morning as a drop in Norwegian output resulted in an under-supplied system. Further along the curve, stronger Brent offered some support to prices, while the colder weather forecast also remains a bullish factor. The power curve displayed similar movement to gas with a slight drop in wind production providing support to the near-curve. Day-Ahead displayed a £1.05/MWh price-drop with an expected decrease in demand over the Easter holidays helping to weigh on the contract.
1-year forward prices
Market close data has revealed that the 1-year forward price for both commercial gas & commercial electricity increased - closing at 48.99ppt and £45.85/MWh, respectively. This can be seen in the graph below.
Note: Brent Crude prices are taken from opening market data, and do not represent the price as it changes throughout the day. Latest Brent Crude Price Brent 1st-nearby prices continue to trade around $55/b today with EIA data showing a drop in production at US oil rigs, providing support to the market.