31st August 2016 | Posted by: Daniel Birkett | Market Analysis

Gas Power
Market Close Market Close
The UK gas system was oversupplied throughout Tuesday's session despite a halt in Norwegian imports due to planned maintenance. Higher UKCS production and weaker demand helped the system remain long and also led to an increase in exports to Belgium. This healthier supply picture helped near-curve prices record a loss, while a drop in Brent weighed on contracts further along the curve. Comfortable renewable generation has been forecast for this week which helped near-curve power contracts close at a discount yesterday, with further bearish pressure provided by a drop in gas contracts. The losses filtered through to the rest of the curve with falling oil contracts an additional factor.
Market Open Market Open
The gas system remains long this morning as imports via the Langeled pipeline have resumed, resulting in another increase in exports to Belgium. As a result, prompt prices have recorded further losses, while another drop in Brent has contributed to downward pressure on the far-curve. Power contracts have moved down this morning with direction coming from weakening gas and oil markets. Healthy wind generation is also expected over the coming days which has helped the prompt to decrease, while a rise in coal prices limited some of the losses on the far-curve.

Brent Summary

Brent 1st-nearby prices displayed further losses on Tuesday on the back of a strengthening US Dollar and comments from the Iranian Oil Minister who claimed the nation aims to increase production, adding to existing oversupply.

1-year forward prices

Market close data has revealed that the 1-year forward price for both commercial gas & commercial electricity decreased - closing at 38.45ppt and £41.93/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 - 31-08-2016

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