The gas system in the UK has opened around 5mcm oversupplied.

It is being driven by reduced demand which is around 10mcm below seasonal normal levels, according to npower’s daily market report.

Bacton IUK interconnector exports are reduced by around 9mcm and a slight reduction in gas-fired power generation is softening demand on the system. LNG send-out from South Hook is at 28mcm with no new tankers on the horizon.

Sam Hill from the Optimisation Desk said: “Prices in both the gas and power market have opened up on last night’s close this morning. This is despite oil prices lingering around their reduced levels – this seems to be in anticipation of OPEC’s discussions later today. Strength in the pound provides some downside as well as reasonably comfortable gas fundamentals.”

Peak power margins for today are around 11GW. Wind generation stands at 3.3GW, making up 10% of the stack, which is providing some relief for gas-fired power generation that is making up 50% of the mix.

Mr Hill added: “Oil is currently trading at $46.34/bbl (£35.6/bbl), ahead of today’s OPEC discussions in Algiers where production freeze talks are high on the agenda.

“We have heard several rumours about the co-operation of the individual parties, with news yesterday that Iran is unlikely to agree to a freeze, however more speculation this morning as Saudi Arabia gave a strong indication they may be willing to compromise with Iran. News throughout the day will see the story develop.”

The pound is valued against the euro at €1.16.