Energy Market Update - 12 June 2024

The market experienced a relatively flat day yesterday as stability in flow levels was maintained.

UK NBP prices softened yesterday due to increased Norwegian flow after resolving last week's Nyhamna and Sleipner issues. Temperatures in the UK are expected to rise following a brief cold period. Despite an unplanned outage at Visund affecting 15.7 mcm/day of capacity, prices fell on the spot and along the curve, influenced by technical market movements and a decrease in attractiveness of LNG cargoes to the EU. UK power prices rose slightly on the spot, but curve prices dropped marginally.

Today, the UK system opened 9 mcm/day oversupplied, aided by strong MRS withdrawals and UK LNG sendout. A decrease in Norwegian flow and above-average LDZ demand were offset by reduced exports to the continent, maintaining high gas levels. Total gas exit nominations to the continent increased to 334.5 mcm/day. Windspeeds are expected to rise, reducing the need for gas-fired electricity generation. No LNG cargoes are expected to berth in the UK soon, with most headed to Belgium, the Netherlands, and France.

Uniper terminated contracts for Russian supplies following legal proceedings after Moscow ceased shipments in 2022. Brent oil is trading at $81.92/bbl, while the UK power DA base price stands at £84.61/MWh. Coal is priced at $118.64/tonne, and carbon at €70.63/tonne. The GBP/EUR exchange rate is 1.1877.