Gas prices in the UK have “pushed up slightly” following a rise in oil prices and a weakening pound, npower’s daily market report states.
The system is forecast to close 18mcm long as healthy flows from the Langeled pipeline continues and strong withdrawals from all three LNG terminals “provide competition in the gas market”.
Weather forecasts also “pushed up a touch” to above seasonal normal levels over the weekend, suggesting demand is likely to drop off this week, particularly in the domestic space, according to Nicholas Morgan from the Optimisation Desk.
The power market is however “slow to get going” this morning.
Mr Morgan said: “There have been no contracts which have traded and there is currently no market for the Sum-17 contract.”
He adds the peak margin is “reasonably healthy” at 11GW although poor wind generation forecast could offer some upwards risk.
CCGT generation is currently at 17GW and is providing 52% of the power generation stack while wind stands at 0.7GW.
Mr Morgan goes on: “The price of oil is surging this morning – thanks to a production disruption in Nigeria, continued worries about the amount of crude Venezuela will be able to produce as the country’s economy continues to plunge deeper into crisis and Goldman Sachs saying the oil market’s oversupply problem may have come to an end. Front month Brent oil contracts are currently trading at $48.65/Bbl (£34/Bbl).
“The GBP to EUR conversion continues to trade an incredibly tight range and the prospect of a notable break-out grows stronger with every passing day of inaction.”
The pound is currently worth €1.268.