Energy Market Update - 28 February 2024

The UK energy market opened balanced this morning, thanks to milder weather leading to reduced forecasted demand.

Norwegian gas exports to the UK have remained steady, while there's an uptick in UK Continental Shelf (UKCS) receipts and nominated withdrawals from Medium Range Storage (MRS), ensuring a stable supply. The latest EC46 weather forecast anticipates temperatures will rise above the seasonal normal throughout the week, only to fall below average over the upcoming weekend.

European gas storage levels are comfortably positioned at 63.48%, slightly higher than this time last year, providing a cushion against potential supply disruptions. Oil prices have experienced a minor decline today, influenced by ongoing economic concerns in both the US and China, which could impact global energy demand.

The energy market witnessed a modest increase in prices yesterday, with the TTF and NBP front month contracts adjusting upwards as traders anticipate the close of the winter delivery period. An unplanned outage at the Skarv facility has slightly reduced gas flow levels, although Russian gas nominations to Europe remain consistent, and Nord Stream's unavailability continues.

The arrival of five LNG cargoes to the UK in the forthcoming weeks is expected to further secure the energy supply, amidst a market that remains vigilant to the fluctuating temperatures and geopolitical developments.