Energy Market Update: UK Gas Prices and Supply Dynamics
In today’s energy market update, UK front-month gas experienced slight bearish movement, potentially as a retracement of yesterday’s gains. Despite this, front-month NBP gas increased by 2.17%, reaching 82.96p. Meanwhile, front-month UK Power declined marginally by 0.41%, finishing at £73.40.
The carbon markets saw mixed results, with Carbon Dec24 EUA’s falling by 1.87% to €74.07, while UKA’s gained 4.57%, rising to £48.54. Brent crude oil prices also fell, ending the day at $81.52, a 0.42% decrease.
A significant development affecting the market is the trip at Norway’s Nyhamna gas field over the weekend, halting production and causing an 80mcm interruption to supply. Although other refineries have started to compensate, the UK is still experiencing a 30mcm drop in supply. This supply disruption is likely contributing to the approximately 6% rally in front-month NBP prices observed this morning.
In terms of storage, EU aggregated gas storage continued to see injections over the weekend, now reaching 70%. This level is well above the 5-year average and is progressing towards the 90% target. This robust storage situation may be exerting downward pressure on near-curve UK gas prices.
In this energy market update its clear to see the interplay between supply disruptions, storage levels, and market prices, reflecting the complex nature of the current energy market landscape.
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