Despite a late rally for oil prices, commodity markets were bearish on Wednesday which pressured down gas contracts. A rise in renewable availability will reduce gas-fired power demand, with warmer weather and stronger LNG send-outs also expected; weighing on the near-curve.
Gas prices moved down on Tuesday with most decreases thought to be technical, with a lot of contracts close to their resistance levels. Supply levels also improved later in the day as unplanned outages in Norway were resolved, balancing the system.
Near-curve gas prices moved higher yesterday due to an undersupplied system, as an unplanned outage limited flows to the UK. Meanwhile, any changes on the near-curve were minor as coal and oil markets weakened, offering resistance to the bulls.
Despite a late rally towards the end of the session, gas prices ended the day at a discount on Friday. The front of the curve found direction from a milder weather outlook this week which will weigh on demand, with a slight rise in renewables expected today. Further out, prices stabilised as bullish oil offered resistance, with coal and carbon also displaying minor gains.
A new report published by Ofwat states that performance and service levels provided by wholesalers within the business retail water market need to improve if the market is to reach its full potential.