Prices drop further amid healthy gas storage levels
Gas prices plunged even further on Tuesday helped by plentiful European storage and a bearish wider energy complex.
The biggest losses were once again observed at the front-end with the new February 24 front-month contract shedding a substantial 0.22p/kWh when compared to its previous close.
Above average storage levels were likely a prime source of pressure, with the latest data from Gas Infrastructure Europe showing that aggregate EU storage levels are holding firm at just over 86% full which is a massive 9% above the 5-year average for that date.
Sizeable losses on the oil and carbon markets may have extended bearish sentiment to the far-curve. Data from ICE shows that the Brent Crude benchmark posted day-on-day losses of 1.5% and the Carbon EUA benchmark shed a considerable 5.5%, the contracts biggest loss in approximately 12 months.
In other news, the United States has been confirmed as the world’s largest exporter of LNG across 2023, outpacing rivals Qatar and Australia for the first time.
Although day ahead NBP prices had initially continued their downward trajectory earlier this morning, most are now being offered circa 0.085p/kWh above their previous settlement at time of writing
If we check the latest half hourly period at the time of writing (10:00 – 10:30), electricity demand in the UK is 35.27 GW’s.
The UK is still experiencing high winds which is helping reduce our need to generate electricity from gas.
33.15% (12.15 GW’s) of the UK’s total electricity is being generated from gas at the moment with wind turbines contributing a healthy 8.57 GW’s (23.38%).
If you want to see more information on the wholesale market trends subscribe to our weekly report here.