Energy Market Update - 30 April 2024

The UK energy market opened higher today, despite a drop in demand due to increasing temperatures.

Today's market movement shows a slight rise in prices across all contract periods despite a decrease in demand, influenced by temperatures around 2°C warmer than Monday. Lower demand led to consumption falling from 155mcm to 140mcm. While the UK system remains balanced in terms of supply, the stronger price opening indicates other influencing factors.

Anticipated cooler temperatures in the coming days have led to increased forecasted demand, particularly affecting near curve contracts. This response to the temperature forecast highlights market sensitivity to changes in weather predictions and their impact on consumption patterns. Additionally, the resumption of operations at Freeport LNG’s Train 1 in the US has positively impacted European LNG supplies, contributing to the current market dynamics.

Moreover, technical movements also played a role in today’s bullish opening, with prices rebounding from recent losses. This indicates potential buying interest re-entering the market at current levels, suggesting a complex interplay of fundamental supply factors and market sentiment driving today's price actions.