Gas prices displayed little movement during Monday’s session as temperatures are expected to turn milder later in the week which will reduce residential demand. However, any downward movement was restricted by outages at Norwegian and UKCS facilities. Further out, the Pound strengthened against the Euro and coal prices weakened, offsetting the effects of rising Brent.
19th March 2018 | Posted by: Catherine Grand | Market Analysis
Gas prices came off quite after opening bullishly on Friday, but ultimately traded down by the sessions close. A sell off on the prompt saw 10p/th of value stripped, with long positions and improved renewables possible catalysts.
Gas prices moved down yesterday following an upward revision in temperatures for the middle of next week and the remainder of March. The system was also long throughout the session despite weak storage withdrawals and above average residential demand. Further out, a late rally in oil prices and a rebound on the coal market restricted bearish movement.
Near-curve gas prices decreased on Tuesday but were yet to completely erase the strong gains recorded on Monday. Cold temperatures are expected at the start of next week but milder weather is forecast to return before the month is out. A drop in storage withdrawals has tightened supply but flows in general were healthy. Meanwhile, a drop in oil prices provided additional bearish pressure at the back of the curve.
Gas prices displayed very strong gains at the start of the session but moved down in the afternoon. However, the bearish shift was short-lived as a downward revision in temperatures for next week contributed to another significant rebound. The expected surge in demand has caused concerns regarding a potential gas shortage due to low storage levels. Meanwhile, decreases on oil and coal markets limited some gains at the back of the curve.