Near-curve gas prices displayed further losses yesterday as a result of a low demand forecast and healthy supply levels. Further along the curve, contracts were pressured down by losses on the oil market, while weakening coal also played a part.
Gas prices displayed losses yesterday as a weaker demand forecast and comfortable supply levels weighed on the market. Coal prices also continued to decrease, while oil prices tumbled on the back of the latest EIA report.
A downward revision in temperatures for next week and a drop in supply helped near-curve contracts move higher in the morning. Unplanned outages resulted in weaker UKCS production, while Russian flows into Europe also decreased. However, a significant drop in coal prices helped to pressure down contracts later in the session, erasing the morning’s gains.
Gas prices shed from their price at the start of the session but recovered in the afternoon following a drop in North Sea production due to an unplanned outage which restricted flows at the St-Fergus terminal. Further support was also provided by a rise in oil prices, although upward movement at the front of the curve was restricted by healthy LNG send-outs, with numerous deliveries expected to dock in the UK.
Healthy supply levels helped to pressure down near-curve gas contracts on Friday, while prices further along the curve were more resilient. A weaker Pound offered some support to contracts but stronger LNG send-outs and a milder weather outlook remained the main market drivers.