5th December 2014 | Posted by: Daniel Birkett | Market Analysis

Spot power prices were offered some support yesterday afternoon from on-going political talks and lower nuclear availability. Today prices are largely dictated by lower gas contracts and very low oil prices. Gas prices continued to weaken thanks to strong supply levels despite increased demand yesterday. The UK gas system has opened long once again despite above average demand and further price drops could be observed as a result.

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?

Cold weather resulted in a rise in demand levels in the UK but this failed to have much effect on the gas curve due to extremely comfortable supply. Norwegian imports into the UK have reached their highest levels since March and this led to an over-supplied gas system. Power prices initially opened lower on Thursday morning but increased as the session progressed. Day-Ahead power fell by £0.10/MWh as wind generation was expected to ramp up and the usual drop in demand on Fridays offered further support to the bears.

How did the energy markets open?

The gas curve moved down once again this morning with direction coming from the weak oil outlook. In addition, the supply picture remains healthy, offsetting high demand levels and Linepack has opened long once again. Weaker gas was the main driver of power contracts today with price-drops observed across the curve. Day-Ahead power fell by £2.35/MWh due to stronger renewable production and weakening oil.

1-year forward prices

Market close data has revealed that the 1-year forward price for commercial gas increased while commercial electricity recorded a small loss - closing at 54.63ppt and £49.68/MWh, respectively. This can be seen in the graph below.

  energy prices

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 Prices

Brent 1st-nearby prices recorded another drop overnight and fell back below $70/b with a bearish outlook in terms of future prices coming from the Middle East.