Supply uncertainty forces wholesale price spike
Uncertainty of Russian gas flows and an undersupplied system helped drive gas prices at the NBP on Thursday.
Contracts across the curve saw upside with those at the front-end posting the largest gains of the session; the January-25 contract gained over 6p/therm (0.21p/kWh) when compared to its previous settlement.
The end of the Russian/Ukrainian gas transit arrangement continues to be a key focus point for European energy prices. Despite comments made by officials from Slovakia there appears to still be much uncertainty and speculation surrounding the deals deadline (which is set to end January 1st), fuelling supply concerns throughout European trading hubs.
A short British system played into the bullish sentiment, with data from National Gas showing this was under supplied by 12mcm/d at 15:00 London time, likely providing increases to prompt prices.
In other news, Donald Trump has floated the possibility of imposing tariffs on the EU if the bloc does not increase their purchase of US oil and gas. The announcement on his social media platform (Truth Social) comes amid the President-Elect’s focus on nations which have a trade deficit with the US.
This morning, gas prices have opened in bullish territory but have begun to retrace gains made during early morning trading. The Summer-25 contract was last offered around 1.5p/therm (0.05p/kWh) above its previous closing price.
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Price commentary courtesy of Crown Gas and Power 