Seasonal contracts are at fresh lows again, according to Inenco’s Y Report.
Kayleigh Winstanley, Energy Trader at Inenco said: “There is scope for them to continue to fall but there are risks heading into winter.”
She added contracts close to the point of delivery “have fallen again and we could see this downward movement continue if the supply of LNG is sustained”.
Ms Winstanley went on: “Maintenance at Kollsnes [gas plant] has reduced flows from Norway but that has been mitigated by increased LNG send-out from South Hook.”
A further four cargoes are expected next week.
In addition to this, maintenance at Britannia UK gas field is expected to be completed by Thursday and also injections into Rough storage are beginning to slow.
Ms Winstanley added: “That’s going to mean an additional supply of gas in the system.”
She said customers with fixed-price contracts should be “getting in the position to secure those agreements now” as it’s not just a “really good price” but also “those contracts will be expiring in the next couple of weeks”.
She went on: “Flexible customers – if you’ve got a low hedge in place, we’re in new territory, prices are really low, perhaps it’s time to start chipping away at that exposure before the delivery point.
“If you’ve got a high hedge in place, I would say hold whilst the downward trend is intact.”