Gas prices continue to head down amid strong gas supplies
Gas prices continued to head down on Wednesday, amid steadfast supplies and a weakening carbon market.
The biggest losses were posted across the prompt and near-curve contracts, with the December 23 front-month contract closing a considerable 0.29p/kWh below its previous close.
The continuation of near-nameplate exports from Norway continued to add pressure at the front-end, data from offshore operator Gassco shows that flow nominations into Great Britain totaled 87.39mcm for the gas-day, helping the British system to manage unseasonably high demand witnessed over the past few sessions.
On the LNG front, the latest shipping signals indicate that 4 laden vessels are on course to berth at British terminals across the next two weeks. This includes the Wudang which is scheduled to offload US volumes at South Hook terminal on Friday evening (data from Port of Milford Haven).
A tumbling carbon market likely offered weight to contracts further along the curve, data from ICE shows that the Carbon EUA benchmark contract fell 2.6% day-on-day, closing at its lowest level since October 20th 2022!
In other news, ten European countries have offered up military vessels and aircraft as part of a new dedicated security plan to safeguard infrastructure within the Baltic Sea, following the destruction of the Nord Stream and Balticconnector pipelines and amid fears of further damage to critical gas, electricity, and telecommunications lines in Northern Europe.
This morning, gas prices have opened at a slight premium when compared to yesterdays close, with the Summer 24 front-season contract last trading circa 0.07p/kWh above its previous settlement at time of writing.
We’ve seen snow in Bournemouth this morning, where our office is based.
As temperatures continue to tumble we are consuming more gas and electricity. If we check the latest half hourly period at the time of writing (10:00 – 10.30), electricity demand in the UK has increased to 43.773 GW’s. 56.57% (25.05 GW’s) is being generated from gas at the moment with wind turbines contributing more today to the total generation mix at 6.13 GW’s (13.83%).
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