Colder weather and low storage levels continue to strengthen spot and near curve prices, with NBP day-ahead prices reaching their highest level this winter. UK NTS demand is expected to be 5mm cm higher than yesterday. Consumption will remain high over the next week as the temperature drops; the snowfall expected this weekend will surely add further pressure to the system. This in turn will likely hold spot prices over the next few days.
How did the energy markets close?
NBP day-ahead hit a high of 96.6ppt last night following depleting storage levels and the markets vulnerability to imported gas. Our dependency on stored gas has been exacerbated due to a lack of LNG deliveries into Europe this year. The spike in the NBP day-ahead price has put a lot of pressure on April 13 power prices, hitting £53/MWh. Another fall in wind generation has led to increase gas-fired generations in order to balance the system.
How did the energy markets open?
Day-ahead gas price rose again today due to the colder weather and supply uncertainty. Power didn't follow gas this morning with the day-ahead price opening up -£1.70/MWh. Wind generation is expected to rise, which has eased pressure on the day-ahead price. On the far curve, power has increased with gas; but has been restricted by the chancellor's announcement of reduced growth.
1-year forward prices
Both gas and power 1-year forward prices have increased today by 0.27/ppt and £0.25/MWh respectively, please see graph below.
Latest Brent Crude Oil prices
Brent prices rebounded yesterday thanks to positive economic data from China. Note: Brent Crude prices are taken from opening market data, and do not represent the price as it changes throughout the day.