UK gas prices have opened lower than yesterday’s close, according to npower’s daily market report.
The gas system is undersupplied with the linepack forecast to close above 20mcm short.
Demand has picked up above seasonal normal levels today as exports through the UK Interconnector are at 10mcm.
Gemma Bruce from the Optimisation Desk said: “This coupled with lower Norwegian flows with Langeled imports down to 25mcm from over 40mcm at the open yesterday has resulted in the short system.”
On the power system, the peak margin is expected to be under 12GW later today.
Ms Bruce added: “With temperatures remaining mild wind generation continues to be lack lustre making up just 1% of the generation stack with gas fired generation contributing 54%.”
Oil is trading above $52/bbl ($35.3/bbl).
Ms Bruce went on: “Yesterday we saw US crude oil inventories shrink in line with predictions by 3.2 million barrels, this has contributed to oil’s longest run of gains in six weeks. A new wildfire in Canada has also prompted new concerns which has seen two large oil producers in the area shut down production. Oil continues to look reasonably bullish although volatile with the presence of the supply glut looming.”
The pound is currently valued at €1.27.