Energy Market Update - 06 June 2024

Energy markets showed slight declines today as gas supply concerns ease with the anticipated return of Norwegian volumes.

UK and European gas prices continued to fall amid easing concerns over the Nyhamna outage, set to return on 7th June. UK NBP Day-Ahead prices are at 80.60 p/therm. Gas demand decreased due to higher wind speeds and mild weather forecasts. Maintenance at Barrow North extends until 8th June. Norwegian flows to Europe increased by 5% to 279.6 mcm/day, with EU storage robust at 70.73%. Langeled flows to the UK remain at 0 mcm due to Sleipner outages.

UK power prices have also declined, influenced by lower gas prices and increased wind generation. The UK Day-Ahead Base is priced at £79.09/MWh. EDF announced delays in the restart of two reactors, impacting supply. Mild weather continues to reduce power demand, with wind speeds above seasonal norms expected to continue, supporting generation.

Brent crude oil prices edged lower to $78.41/bbl due to a surprise build in US crude stocks and increased fuel inventories, raising supply concerns. Coal prices remain stable at $120.62/tonne. European carbon prices are at €71.82/tonne, reflecting stable market conditions.

The UK energy market is currently stable, with the anticipation of increased gas supply from Norway. Temperatures are expected to stay below seasonal norms until mid-June, reducing demand. LNG imports are steady, with one cargo arriving next week and more scheduled for North West Europe. The UK's energy supply remains secure, with balanced gas and power markets as we transition towards summer.