Energy Market Update - 25 September 2024
Gas and power prices rose during early trading this morning, with the NBP front-month gas contract up by 1p/therm and Winter 2024 up by 0.60p/therm, driven by supply disruptions and cooler weather forecasts.
UK gas demand remains below seasonal averages despite a 5mcm increase in consumption, leaving the system 3mcm long. Langeled flows dropped to 48mcm following unplanned outages at Sleipner, Asgard, and Karsto, which are delaying the restart of full operations after planned maintenance. As temperatures are forecasted to fall 6°C below average by the weekend, a rise in gas demand is expected.
On the power side, UK Day-Ahead Base was trading at £85.16/MWh, supported by a forecast of reduced gas-for-power usage as wind speeds are predicted to double tomorrow. European power prices continued to lag behind gas, with the Winter 2024 contract falling slightly to £80.25/MWh. Meanwhile, cooler weather across Europe has kept gas demand steady despite high levels of storage, currently at 93.74% of capacity.
Brent crude settled at $75.17/bbl, and the EUA Dec 2024 carbon contract remained stable at €63.87/tonne. Potential LNG disruptions due to a US storm, combined with ongoing geopolitical tensions in Ukraine and the Middle East, are adding further uncertainty to the market.