Energy Market Update - 18 March 2024

The energy market experiences an uptick in prices amidst a backdrop of global uncertainties, including earthquake activity in Japan, heightened LNG demand from China, and disruptions in the Red Sea. These factors, along with local supply issues, contribute to a somewhat nervous market atmosphere.  

Recent sessions saw the TTF Front Month contract rise to €28 from €27.03, while the NBP Front Month increased to 68p from 68.01p, reflecting the market's response to both global events and localised disruptions. The unplanned outage at Aasta Hansteen and variations in Russian gas nominations highlight ongoing supply challenges. Meanwhile, EU gas storage levels remain substantial at 59.67% full, offering some buffer against supply concerns.

 In the UK, the energy market shows a slight shortage with maintenance and outages affecting domestic production. The stable flow from Langeled and the expectation of LNG arrivals suggest a cautious optimism for supply stability. Moreover, the slight warmth in the forecast may reduce immediate demand pressures. Key price movements include the Curve TTF and NBP contracts adjusting in response to current events, with UK Power prices also indicating an upward trend.

 This landscape is further complicated by the continued volatility in oil prices and the steady increase in EUA prices, suggesting a complex interplay of factors influencing the energy market. The incoming LNG cargoes to the UK and North West Europe, alongside maintenance and outage developments, will be key to monitoring as the market navigates these challenges.