|Milder temperatures and an improved supply picture helped near-curve gas contracts move down on Wednesday, while falling oil prices helped to weigh on the far-curve. Early morning gains were cancelled out in the afternoon, with a rise in imports via the BBL pipeline and weaker demand resulting in an oversupplied system.
|Lower renewable generation and a downward revision in temperatures for the rest of the month offered support to the gas curve yesterday morning. The bullish sentiment was cancelled out in the afternoon by losses on the gas market, following improved supply and another fall in oil prices.
|Overall fundamentals are little changed from yesterday's session as the outages in Norway were resolved and imports into the UK are stable. Temperatures remain around the seasonal norm but a drop in UKCS production has dragged the system into undersupply. The prompt has opened flat, while movement on the rest of the near-curve is generally bullish, however, weakening oil continues to pressure down contracts further out.
|Contracts at the front of the power curve have mirrored the upward movement displayed by their corresponding gas counterparts this morning, with temperatures set to drop over the next two weeks. Wind generation is also forecast to remain low next week, providing additional support. Movement further along the curve is more varied with a jump in APi2 coal offsetting the effects of weaker Brent.
Brent 1st-nearby prices have recorded another loss due to increasing doubts about OPEC member's commitment to reducing output levels. API data also revealed that US crude oil inventories increased last week, helping Brent to fall below $51.5/b.
1-year forward prices
Market close data has revealed that the 1-year forward price for both commercial gas & commercial electricity increased - closing at 44.80ppt and £46.06/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
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