|Unplanned outages in Norway helped gas contracts move higher on Thursday, with the upward trajectory continuing on Friday morning. A cooler weather outlook also offered support to the curve due to an expected rise in LDZ demand. Meanwhile, stable-to-bullish fuel markets continued to restrict any losses at the back of the curve.
|A healthier wind generation forecast for the start of this week helped the prompt shed from its price on Friday. However, the rest of the near-curve found direction from gas supply constraints and a colder short term weather outlook. Elsewhere, coal, carbon and oil markets stabilised and movement at the back of the curve was minimal.
|A drop in temperatures has lifted residential demand but a sharp rise in wind levels has reduced gas-fired power generation. As a result, demand is 31mcm below the seasonal norm and the system has opened 10mcm long, weighing on the prompt; although the downward movement is minimal due to a prolonged outage in Norway. Further out, prices have climbed higher with support coming from rising oil prices.
|Renewable generation is expected to decrease slightly tomorrow, resulting in a small gain on the prompt. The rest of the curve has moved down, as despite cooler temperatures compared to last week, consumption levels remain low for this time of year. Changes at the back of the curve are minimal as fuel markets remain relatively calm.
For a breakdown of the current generation mix visit our Power Generation Insights page.
Brent displays little movement from Friday and overall sentiment on the oil market remains bullish due to optimism in regards to an extension to OPEC production cuts.
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 50.55ppt and £50.15/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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