Energy Market Update - 16 August 2024

UK gas prices opened slightly higher today but eased off as the morning session progressed. The overall market remains stable, despite some ongoing geopolitical concerns and maintenance activities.

The UK system started the day slightly short by 2.4mcm, with consistent demand at 159mcm. Exports to the continent are strong, maintaining a flow of 46mcm. Looking ahead, increased wind generation expected next week could reduce demand for gas-fired power generation, potentially weakening prompt prices.

In the wider European context, Norwegian gas flows have remained stable, despite upcoming maintenance that will reduce output by 140mcm at the end of August. Meanwhile, oil prices rose on Thursday, driven by positive economic data from the US and ongoing geopolitical risks in the Middle East.

In terms of market prices, UK NBP Day-Ahead gas is trading at 78.00 p/therm, and UK Day-Ahead power is at £67.29/MWh. Brent crude has increased to $81.04 per barrel, reflecting continued market volatility.