Both the power and gas systems in the UK are “comfortable” today, according to the daily market report from npower.
That along with “weaker carbon and poor Chinese data” has led to contracts pushing a “fair bit lower” this morning, Tom Matthews, Client Portfolio Manager said.
Gas held in the system is expected to increase around 7% today – the main driver being “robust Norwegian and Dutch flows” and ongoing weak demand.
Wind generation is strong and production from nuclear power stations also look “fairly robust”, Mr Matthews added.
He went on: “Carbon continues to push lower as confidence in the market seems to decrease and worse than expected Chinese PMI [Purchasing Managers Index] data is generally weighing on in the fuels so everything looking fairly bearish.”
Mr Matthews suggests keeping an eye on the “Euro movements as worse than expected PMI data from Germany have yet to filter into the Euro”.
“Ongoing tensions around Russia continue to flare this and has yet to be fed into gas prices however with them supplying so much gas to Europe, it probably will be important to keep an eye on that story”, he added.