Gas prices correct upwards amid surge in gas fired power demand
After a series of losses, gas prices corrected upwards on Thursday amid bullish oil futures and a surge in gas-fired power demand.
Small, incremental gains were posted across the curve, with near-dated contracts lifting by circa 0.04p/kWh when compared to their previous close.
Geopolitical tensions in the Middle East and mandatory OPEC production cuts continue to affect oil prices; according to the latest data from ICE the Brent Crude benchmark contract has lifted 6.1% across the previous six sessions.
Further support likely came from declining wind output which subsequently bolstered gas-for-power demand. According to data from National Grid, CCGT (Closed Cycle Gas Turbine) power demand surged to 8 GW (66% higher day-on-day) with wind turbine output tumbling 32% across the same period.
Key contracts continue to edge higher this morning, with the Winter 24 front-season contract currently being offered circa 0.03p/kWh above its previous settlement, at time of writing.
The UK is currently consuming 33.12 GW’s of electricity (09:00 – 09:30).
Wind has picked up today and is currently generating 15.73 GW’s (44.94%) of the UK’s electricity with gas only having to contribute 1.52 GW’s (4.35%) at the time of writing.
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