Gas demand increases – DMR

The UK saw an increase in gas demand this morning. This is due to a short opening in line packs. The demand has swung from less than 20mcm at the […]

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The UK saw an increase in gas demand this morning.

This is due to a short opening in line packs. The demand has swung from less than 20mcm at the start of the week to above 30mcm.

Other than that the markets have opened relatively flat.

Steve Walker, Client Portfolio Manager at npower said the increase in carbon tax and the generation spread in narrower gas-coal “should make for interesting prompt demand vitality”.

Wind supply is at 20% and could be less over the next week, it is lower than expected but will be offset by solar power which will increase to 4GW this weekend.

Spark spreads are still quiet as the fundamentals look the same.

 

Exports through the IUK are still strong with above 30mcm. This is because of dips in storage withdrawal and LNG sendout.

Inventory builds are at record level but have slowed down. Cuts from major producers triggered the move.

Oil markets still have high volatility, with a 5% increase yesterday. This is the highest level year to date. This is due to the amount of headline attention both fuels have received recently.

Mr Walker concluded: “The gains are also in contrast to terrible Chinese data yesterday.”