Gas prices rebound as demand increases
Gas prices rebounded slightly on Thursday amid unseasonably high demand and unplanned UK maintenance.
After three consecutive days of downward momentum all curve contracts posted small gains when compared to their previous close, with prices at the front-end lifting circa 0.06p/kWh day-on-day.
A tighter supply and demand dynamic was likely the primary driver throughout the session. Data from National Gas shows demand totaled 395.1mcm across the gas-day, well above the seasonal norm of 297.7mcm, with strong heating-related demand and high gas-fired power generation squeezing supplies.
Further pressure came from capacity restrictions at the UK’s Elgin Franklin and Perenco Bacton facilities totalling 10.8mcm, although both unplanned outages are expected to be resolved by this evening.
In other news, a severe cold weather event affecting the Southern United States region has prompted operators at the Freeport and Cameron LNG terminals (among others) to delay and/or cancel some cargoes, which could limit US LNG exports to Europe in the short-term.
Key contracts continue to edge higher this morning, with both the front-month and front-season contracts currently being offered circa 0.03p/kWh above their previous settlement, at time of writing.
If we check the latest half hourly period at the time of writing (08:30 – 09:00), electricity demand is currently 45.61 GW’s in the UK.
Wind generation is currently contributing just over 32% of the UK’s total electricity demand.
Specifically, 32.43% (14.93 GW’s) of the UK’s total electricity is being generated from wind turbines currently with gas contributing 22.68 GW’s (49.25%).
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