Chris Durman

Today 16th October’s UK energy landscape reflects shifting dynamics across gas, power, and renewables, with mild temperatures and steady LNG inflows shaping the market. Gas prices on the NBP day-ahead market settled at 96.00 p/therm, slightly lower than the previous session, as the system opened this morning undersupplied by 22 mcm/day. While piped flows from Norway remained flat, UKCS production decreased to 102 mcm/day. LNG send-out from South Hook and Isle of Grain provided 14 mcm/day, with additional LNG cargoes expected in the coming weeks to support the UK’s supply. Power prices followed suit, with the day-ahead baseload settling at £67.88/MWh, a sharp decline from yesterday’s £87.12/MWh, reflecting higher wind generation and milder demand expectations. However, as wind forecasts predict output dropping below seasonal norms in the coming days, gas demand for power generation could increase, potentially influencing prices upward. On the supply side, nuclear availability remained steady despite several ongoing outages, including units at Heysham and Torness. Weather forecasts suggest today will be the warmest of the month so far, with temperatures expected to stay above seasonal norms until the end of October. This trend is contributing to softer demand for heating, easing pressure on both gas and electricity markets. Meanwhile, carbon prices also eased slightly, with EUA Dec 24 certificates trading at €65.09/tonne, and the UK ETS market at £39.04/tonne, reflecting reduced short-term emissions intensity. Currency movements saw GBP/EUR at 1.1997, while GBP/USD edged up to 1.3072. With three LNG cargoes set to arrive soon and strong Norwegian flows to the continent, market fundamentals appear stable, though fluctuations in wind generation may drive volatility in power prices in the days ahead.

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On October 18th, 2024, the UK energy markets opened with tighter gas supplies and fluctuating power prices, reflecting a complex mix of operational challenges and evolving demand forecasts. The system started the day 7 mcm undersupplied, with Norwegian flows through the Langeled pipeline reduced by 4 mcm due to ongoing maintenance. Two offshore projects in the UK Continental Shelf are also impacting supply, though both are expected to conclude today. However, the Oseberg field’s outage, cutting 27 mcm/day, has been extended until tomorrow, and Gullfaks will remain offline until November 1st. Gas prices are moving with these constraints. The NBP Day-Ahead settled at 96.00 p/therm, slightly up from the previous session. Curve contracts were mixed, reflecting uncertainty around maintenance schedules and geopolitical tensions. Despite these disruptions, the UK is forecasted to receive one LNG cargo by month-end, while Belgium and France are set to take more significant volumes. In power markets, the UK Day-Ahead baseload price dipped to £86.58/MWh, down by £3.02 from the previous day. Peak power settled at £90.26/MWh, a noticeable drop from £96.70/MWh. Renewables are expected to support the grid with above-average wind speeds through October 26th, though forecasts suggest output may fall short of demand by around 2000 MWh/h towards the end of that period. Temperatures are expected to remain slightly above seasonal norms for the next week, providing some relief to heating demand before colder conditions return. Oil prices remain steady, with Brent at $74.45/bbl, while carbon permits hover around €62.98/tonne for EUA Dec-24 contracts. Overall, the market remains on edge, with winter risks looming and the geopolitical environment adding further complexity. Traders will closely monitor the completion of maintenance schedules and incoming LNG deliveries, both of which are critical to stabilising the market in the coming days.

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A very interesting piece on #GBEnergy's shortcomings by Mathew Lawrence of Common Ground, published by New Statesman Spotlight 👇 Key recommendations: - GB Energy should be given sufficient borrowing power for large-scale investment - The company requires greater capitalisation than the current £8.3bn - There should be a customer-facing retail supply arm https://lnkd.in/ej9NHfUc 💡 CEP responded to the GB Energy announcements here: https://lnkd.in/eR34yesD 💡 ...and we've discussed what Great British Energy can't do here: https://lnkd.in/ee4v3tEm

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As of 7th October 2024, the UK energy market has opened with notable shifts in gas and power prices, reflecting both geopolitical uncertainty and supply-demand dynamics. UK natural gas prices rose slightly, with the NBP Day-Ahead contract settling at 97.80 pence per therm, a 2 pence increase from the previous session. This upward movement is partially attributed to ongoing unplanned maintenance at Norway's Troll gas field, as well as planned maintenance at other facilities. Total exit nominations have now reached over 300 million cubic meters per day, but despite bullish factors like strong Medium Range Storage injections and increased gas demand for power, market fundamentals remain largely bearish. Norwegian imports to the UK are flowing at 58 million cubic meters per day, while temperatures are forecasted to drop below seasonal averages starting 9th October, which could shift demand in the coming days. UK power prices have also experienced some volatility, with the Day-Ahead baseload price falling to £76.24 per MWh, a decrease of over £7 compared to the previous session. However, forward contracts, particularly for Q1-25, saw increases as prices for Nov-24, Dec-24, and Jan-25 edged up. The gas market’s influence, coupled with geopolitical tensions, continues to play a key role in shaping short-term price movements. Wind speeds are expected to remain above seasonal averages, except for the weekend, which could alleviate some of the pressure on power prices. On the global stage, Brent crude oil saw a modest increase, reaching $78.05 per barrel, reflecting market reactions to heightened geopolitical risks in the Middle East and Ukraine. Coal prices for delivery in 2025 also surged to $127.79 per tonne, a sharp rise of nearly $5 as uncertainties in global supply chains persist. Meanwhile, EU carbon prices have dropped to a six-month low, standing at €62.05 per tonne, amid strong renewable energy output, reduced liquefied natural gas consumption, and macroeconomic concerns. Currency fluctuations have remained relatively stable, with the GBP/EUR exchange rate moving slightly to 1.1942 and GBP/USD holding steady at 1.3116. Looking ahead, the UK system remains 30 million cubic meters per day short as we start the week, with three LNG cargoes expected by 18th October. Windspeeds and temperatures are forecasted to fluctuate, potentially impacting both gas and power markets. The geopolitical landscape, particularly in the Middle East, remains a significant factor to watch, with the potential to drive further market volatility in the weeks ahead.

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UK energy markets saw a surprising shift today as front-month gas prices rebounded by 1.56%, closing at 85.90p/therm, following a significant sell-off earlier this week. This recovery raises questions about whether the market is stabilising or simply experiencing a brief correction amid ongoing supply concerns and the unpredictability of winter demand. Front-month UK power prices also climbed, finishing at £73.00/MWh with a modest 0.48% increase. Market analysts point to fluctuations in fuel prices, upcoming weather patterns, and infrastructure maintenance as key factors influencing this slight rise. With winter approaching, the power market is bracing for potential surges in demand that could push prices higher. In the carbon markets, EU Carbon Allowances for December 2024 saw a healthy rise of 1.49%, closing at €65.89, as companies continue preparing for compliance with emissions regulations. UK Allowances, however, dipped marginally, finishing at £42.25, underscoring the different regulatory landscapes between the UK and Europe. Oil markets, meanwhile, continued their downward trend, with Brent crude oil slipping 0.25% to $69.02 per barrel. Concerns over slowing economic growth in major economies like China and ongoing supply strength are keeping oil prices under pressure. As the market fluctuates, uncertainty remains a dominant theme across energy sectors. Traders are closely watching for shifts in supply patterns and geopolitical developments that could drive further volatility. The next few weeks will be crucial in determining how the UK’s energy landscape evolves as we head into the colder months. Keep an eye on these developments, as they could significantly impact both short and long-term energy pricing.

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                 Morning Briefing 26/09/2024 Day ahead (DA)/Intraday   ·Demand is currently at approx. 29.8GW and due to peak this evening at 32.6GW. ·DA markets auctioned between £34 - £97 yesterday for today. ·Baseload auctioned at @ £73.69 in the 1hr and £74.59 in the 30min auction. ·Wind generation is currently 5GW under forecast at 7.7GW and due to peak at 15.4GW later today and stay at similar levels tomorrow. Solar is due to peak at 3.1GW at 1pm. ·Current intraday power price at time of writing was £90.80/MWh with gas providing 26.9%/8.67GW, wind providing 33.5%/10.81GW, solar providing 2.5%/0.81GW and nuclear providing 13.6%/4.38GW of UK demand. ·DA gas is currently trading at 89.33p/th (3.05p/KWh) ·DA power is currently trading at £56.00/MWh (5.60p/KWh)   Month ahead (Oct 24) ·Oct NBP gas is currently down 1.35% at 89.02p/th (3.04p/KWh). ·Oct TTF gas is currently down 0.99% at €36.95MWh. ·Oct UK Baseload is trading at 75.25/MWh (7.53p/KWh) ·UK gas prices were up fairly strong yesterday, with the DA price up 4.35% as colder weather forecasts indicating that the winter gas season was looking to begin. Along the curve, the Win24 contract was 4.46% as extensions to maintenance at Norwegian assets and the cold weather forecasts brought some worry to the market over Winter supply. ·UK power were slightly mixed again, with the DA price down 13.47% due to the forecast sharp rise in wind generation today. Along the curve, the Win24 contract was 4.44% tracking the gas market, as the forecast colder weather and drop in Norwegian supply added some upward pressure. ·According to Gassco AS, there are still unplanned outages at Sleipner, Karsto and Asgard this morning, reducing flows by 66.0MSm with total flows reduced due to other planned maintenance at 267.3MSm. ·Oil prices are down over 2% this morning, reversing earlier gains, as news of top exporter Saudi Arabia giving up its crude oil target in preparation for expanded production weighed on the market.    ·Latest forecasts show temps to be under seasonal norms until the end of the month. ·There are currently 2 LNG cargoes due in the coming weeks. ·UK Gas prices as of Wednesdays close -  o   Month ahead 90.24p/th (3.08p/KWh) up 5.97% DoD* o   Q4 24 93.79p/th (3.20p/KWh) up 5.06% DoD o   Winter 24 95.89p/th (3.27p/KWh) up 4.46% DoD ·UK Power prices as of Wednesdays close – o   Month ahead £75.15/MWh (7.52p/KWh) up 7.05% DoD* o   Q4 24 £80.33MWh (8.03p/KWh) up 4.79% DoD o   Winter 24 £83.19MWh (8.32p/KWh) up 4.44% DoD *DoD = Day on Day All prices and info correct at time of writing. Eco Logic Partners Jason Gary Martin Karl Lucas David Jo Chart credit - e*star #energy #trading #power #gas #oil #renewables #lng #norway #winter

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