|Near-curve gas prices moved down on Friday as the supply outlook for this week was much improved. Norwegian flows are set to increase, milder temperatures should reduce demand levels and a number of LNG deliveries are expected to dock in Europe over the next few days. Far-curve contracts were more stable as coal and oil markets continued to provide support.
|Bullish coal and oil markets helped far-curve power contracts to add to their price on Friday but the near-curve displayed losses thanks to healthy fundamentals for this week. Wind and solar generation were expected to rise over the weekend and a warmer weather outlook will weigh on consumption.
|Temperatures for this week were revised higher over the weekend and demand levels are expected to fall. Meanwhile, the system has opened long due to improved Norwegian flows and weaker residential demand, weighing on prompt prices. Downward movement on the far-curve is less prominent as a rising oil market continues to restrict the bears.
|Power contracts have decreased this morning, tracking their weakening gas counterparts. Lower demand levels are expected due to warmer weather and renewable generation has improved from last week’s levels. Wind generation is forecast to fall later in the week but solar power is set to remain strong.
For a breakdown of the current generation mix visit our Power Generation Insights page.
Brent 1st-nearby prices have strengthened further as Saudi Arabia confirmed its oil producers would cap output until March 2018 at least; Brent now trades above $54/b.
1-year forward prices
Market close data has revealed that the 1-year forward price for both commercial gas & commercial electricity recorded a loss – closing at 42.50ppt and £42.08/MWh, respectively.
Today’s prices can also be found in an easy to read table on our ‘current UK energy price' page.
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