8th January 2016 | Posted by: Daniel Birkett | Market Analysis

Gas Power
Market Close Market Close
Gas prices moved higher yesterday afternoon despite the UK gas system opening around 25mcm long which led to losses at the start of the session. However, prices took direction from the expected drop in temperatures over the weekend and next week. A rebound in oil prices and a stronger Euro also ensured upward movement further along the curve. Power contracts also posted gains on Thursday, tracking the movement of the gas curve with a colder weather forecast the driver of both markets. Temperatures in the UK are expected to fall below 0 ° at some point in the next week, resulting in a rise in heating demand.
Market Open Market Open
Milder temperatures are expected to return to the UK from January 13th onwards which has helped some gas contracts record a loss this morning. Meanwhile, a processing plant in Norway has suffered an unplanned outage which has reduced flows by 32mcm; restricting downward movement on the near-curve. Three coal plants could be brought online to help meet demand over the upcoming cold period; generation levels in the UK are currently healthy with no new outages at power units to report. European renewable generation is also on the rise with levels set to increase from 20GW to 70GW on Sunday, helping to weigh on some contracts this morning.

Brent Summary

Brent 1st-nearby prices displayed a rebound on Thursday and now trade back above $34/b after hitting a 12-year

low yesterday morning. A rise in Chinese shares helped both Brent and WTI contracts increase in value.

1-year forward prices

Market close data has revealed that the 1-year forward price for both commercial gas & commercial electricity decreased - closing at 33.04ppt and £36.33/MWh, respectively.

Today's prices can also be found in an easy to read table on our 'current UK energy price' page.

Click graph to enlarge

energy price graph - 2016