Gas prices displayed further losses yesterday with direction coming from a warmer weather outlook and bearish movement on coal and oil markets. Demand levels are expected to fall below 200mcm over the weekend but some upward pressure was provided by unplanned outages which reduced flows into the UK.
Gas prices initially opened at a premium yesterday but decreased as the session progressed. Warmer temperatures are now expected as we close in on the weekend which will result in lower demand, allowing storage injections to take place. Planned maintenance in Norway and an unexpected outage at St Fergus provided resistance, while LNG deliveries will be sparse over the coming weeks.
Colder temperatures resulted in higher demand levels yesterday and prices across the near-curve increased. Storage withdrawals were needed to try and balance the system, providing further support, although a rise in LNG send-outs provided some resistance. Additional upward pressure was also applied in the afternoon following an unplanned outage at St Fergus. Further out, prices were pushed higher by rising coal and oil markets.
Gas prices climbed higher on Friday with colder temperatures expected over the weekend and the start of this week. Low wind levels resulted in a sharp rise in CCGT demand, tightening the system and providing additional support. Further out, contracts were pushed higher by a rise in coal prices, with little resistance provided by oil markets.
Gas prices increased across the curve on Thursday with below average temperatures expected over the coming days. Unplanned outages and weak LNG send-outs also limited supply levels, offering further support. Meanwhile, oil and coal prices increased in the afternoon, helping to lift contracts on the far-curve.