Market Comments January
Wednesday 2nd January 2019 - We ended last year with a very bearish market for European gas markets. This morning the market has come off to a bullish start in the front, while the curve is more unchanged. The front is up despite a enormously long system and warm weather for continental Europe for most part of the forecasting period. There is some uncertainty about temps in the latter half of Jan. World equity markets have come off to a bearish start of 2019, and coal and oil are down today.
Thursday 3rd January 2019 - European gas markets came off to a strong start of 2019. It was mostly the front that was traded up on higher probability of a cold spell later in Jan. This morning we are down again on a well supplied system, warmer weather and still plenty of LNG on its way towards Europe. Coal, oil and Carbon have also started the day on the bearish side.
Friday 4th January 2019 - Yesterday gas was also weak, while oil saw some revival. Today the weather is showing some signs of colder weather in the end of the forecasts, but the timing is still uncertain. Oil is also on the strong side, while coal and EUA’s are more unchanged. Gas is up in the front, and so is power across the board.
Monday 7th January 2019 - The UK has opened with gas prices significantly lower than the close on Friday, with quick prices shedding huge value to start the week. The UK has turned milder in comparison with last week reducing the gas demand, with flows remaining strong. Gas demand for power has fallen to 52mcm due to higher wind levels and total demand is set to be 15mcm below seasonal norm.
Tuesday 8th January 2019 - Gas prices came off across the board in yesterday’s session. The downward correction was most pronounced in the front end where the front months traded down around 1.3 €/MW on the Continent and around 3.5p/th in the UK. Further out on the curve prices are coming less off due oil prices seems to have bottomed out and is starting to climb again. This morning the weather forecasts confirm a tendency towards colder weather end of January and prices are rebounding.
Wednesday 9th January 2019 - Gas prices recovered yesterday, driven up by strength in the spot market coupled with curve gains driven by increased prices for coal, oil and carbon. This morning, demand is up, however, supplies have moved higher in lock-step and the system is long 26mcm. Stock levels have remained very high for the time of year as demand waned over the holiday period. Prices are up slightly with oil and stock markets in early action.
Thursday 10th January 2019 - Gas prices dropped yesterday, coming under pressure from an oversupplied system as temperatures are set to warm up further this week. This morning, the system is again oversupplied as demand falls and supplies increase. Prices are marginally up as gas follows on the yesterdays move in oil. Forecasts are calling for a return to below normal temperatures near the end of the 15-day forecast.
Friday 11th January 2019 - Gas prices finished yesterday’s session broadly unchanged after see-sawing up and down over a penny through intraday volatility, despite little changes in the broader energy complex, save for coal which gained a dollar. This morning, the system is long a scant 6mcm despite a sharp drop in demand as temperatures warm up into the weekend. Gas prices are up as traders cover positions into the weekend as oil ticks slightly higher and a return to below normal temperatures is expected the following week.
Monday 14th January 2019 - Gas prices recovered on Friday, closing up as traders closed short positions moving into the weekend over concerns of rolling cold weather forecasts which could provide a lift to prices on Monday. This morning, the European energy complex is mostly sideways with only minor increases or losses across coal, gas, power and carbon, so far, the biggest move is oil which is down 75 cents in early trading.
Tuesday 15th January 2019 - This morning’s gas prices are retracing some of yesterday’s losses, as prices in crude halt their slide and coal makes modest increases. Gas prices are up on a more balanced system and cooler weather to come. Broadly, markets are up as china signals tax cuts to combat an economic slowdown, which are helping equities markets as well as the commodity complex.
Wednesday 16th January 2019 - Gas prices recovered yesterday, rising with crude and coal as temperatures are set to drop. This morning, the system is long, forecasts are broadly unchanged but continue to confirm below normal temperatures for the 15-Day outlook. After last night’s BREXIT debacle, the pound has been left to gain against the euro, seemingly unfazed as a confidence vote will take place today.
Thursday 17th January 2019 - Gas prices were varied after yesterday's session ended, a unpredictable day which saw prices drop.. This morning, the system is long as temperatures drop below normal and forecasts show that the cold weather will linger for the balance of the month. despite this length, spot prices are up with curve contracts as coal, oil and even carbon make early morning gains.
Friday 18th January 2019 - Gas prices united yesterday as the first day of a cold snap hit most of Europe. This morning, the market is again slightly long, flows are mostly unchanged, save for a minor increase from Norway and storages are not seeing too much impact in the markets, coal is down slightly in early trading along with carbon, while oil is up leaving gas and power trading mostly flat to yesterdays close.
Monday 21st January 2019 - Gas prices were softer on Friday as the cold weather rally lost a bit of steam and players took profit on positions ahead of the weekend. This morning, the system is long, and oil, coal and power are all trading down with gas as weather forecasts have swung warmer with temperatures in some regions expected to again reach above normal in the near term with 15-day forecasts all trending much closer to normal temperatures for the time of year.
Tuesday 22nd January 2019 - Gas prices took a thrashing yesterday, after weather forecasts changed over the weekend, turning warmer and additional arrivals of LNG were announced. This morning, the system is forecast oversupplied as nominated pipeline imports coupled with LNG and storage send-outs exceed demand. The market looks like it could take a breather today, with coal and power retracing some of yesterday's losses the price looks technically oversold and the bulls might try and give it a push, fundamentally the upside should be limited.
Wednesday 23rd January 2019 - Gas prices dropped slightly in the UK yesterday, following a stronger pound and a generally well supplied system. This morning, the market has rebounded as coal and oil are both increasing while temperatures hit their lowest levels forecast for the 15-day outlook. The system is short supporting spot price which has filtered to a bit of buying on the curve, with ample gas in storage the UK should be able to come to balance with no great effort.
Thursday 24th January 2019 - Gas prices moved up yesterday on the back of a short system, falling oil and carbon prices kept a lid on any break-out rally. This morning, the system has flipped back to long from short as temperatures have warmed up slightly today and are expected to move up further into the weekend. Revised 15-day forecasts are pointing to slightly more mild temperatures this morning, while coal, oil and carbon prices trade lower.
Friday 25th January 2019 - Gas prices took a hit yesterday from lower demand as temperatures have begun to warm up and the broader energy complex sold off, coal lost over $2 in value, carbon and oil suffered smaller drops. This morning, the market is taking another beating as aggressive price drops welcome traders to a Friday market. Coal, carbon and power are down while oil has made some minor gains on the turmoil in Venezuela. The pound is up on support from the DUP for the Irish backstop and May's BREXIT plan.
Monday 28th January 2019 - Gas prices were distributed lower on Friday, supplies into Europe and the UK remain robust with strong pipeline flows from Russia and Norway, coupled with increases in Dutch production and a continuing armada of LNG deliveries to European shores. This morning, the system is balanced as LNG terminals and storages pull back on send-outs on mild weather. Oil prices are down in early trade action while coal prices and carbon prices are up, gas is trading around the previous close as the market sizes up a German government announcement to cut coal fired power production by 13GWh by 2022.
Tuesday 29th January 2019 - Gas prices continued to drop yesterday, falling with the broader energy complex, coal, oil, power and carbon. This morning, the system is long, flows are strong, and demand is starting to decline. Prices are down in both the UK and on the continent, coal power and carbon are also being dealt lower in early trade action, only oil is trading up from yesterday's close.
Wednesday 30th January 2019 - Gas prices stopped their slide yesterday afternoon, after an early morning sell-off. This morning, the gas market is trading around the close from yesterday, oil and coal are also trading flat to the previous close while carbon is slightly lower, power prices are mixed. The system is long today, and temperatures are still on track to move to normal early in February, however another bought of cold weather could be forming for the 2nd week of February, albeit this is not expected to be as cold as the 'mini-beast'.
Thursday 31st January 2019 - Gas prices cut yesterday, rallying in the morning before reversing course and selling off into the afternoon to close down on the day. This morning, the story remains the same, long system and downward price pressure. Coal, carbon gas and power are all dealing lower this morning as weather forecasts continue to look mild into the first half of February.
Market Comments February
Friday 1st February 2019 - Gas prices continued to fall into the weekend as bearish sentiment pervades the broader commodities and energy complex. This morning the route continues as the gas market contends with an oversupplied UK system which will have to inject to storages or burn the gas to balance. Stock markets are opening slightly positive in Europe after a mixed session in Asia.
Monday 4th February 2019 - European gas prices dropped across the board on Friday, with warmer weather in the forecasts and a well-supplied system. The market opens down this morning, where we also see coal and carbon down. Oil is the only thing up this morning as positive talks between US and China have spurred optimism. This adds to a strong close by oil on Friday as US oil rigs dropped by 15 and OPEC+ reports good compliance with production cuts. Oil is currently trading $ 63.20 /bbl., the highest level since beginning of Dec-18.
Tuesday 5th February 2019 - Coal and carbon were down from the morning, and with warmer weather, this kept the downward pressure on European gas markets. But during the day, carbon turned around, and shot up, ending the day more than € 1/ton up. Gas climbed throughout the day and seemed to be driven by the rebound in carbon and a few minor unexpected outages.
Wednesday 6th February 2019 - Prices were generally unaffected to slightly down yesterday in European gas markets, in a relatively calm session compared to previous sessions. Gas has fallen a lot lately, especially in the front, and couldn’t follow the rest of the complex down. This morning, prices are unchanged to marginally down compared to closing prices. Carbon and coal see small bounces, but oil is coming off further, so a bag on mixed inputs, with weather being unchanged.
Thursday 7th February 2019 - European gas prices came off yesterday, with losses highest in the front end of the curve. As we have reported numerous times, the general supply situation is very good, with high flows from both Norway and Russia. This morning we see a slightly short system in the UK, due to lower flows from Holland as the spread between the two has decreased. Coal and carbon are up and gas is also up a touch, although the overall picture hasn’t changed much since yesterday.
Friday 8th February 2019 - Coal took a descent yesterday and closed below the $ 80 / ton support level. Coupled with falling oil and carbon, inputs to the gas markets were bearish yesterday. Temperatures are warm at the moment but expected to drop over the coming weeks to around or slightly below seasonal average. This morning we see a balanced system, but the market is coming off further. Coal, carbon and oil is unchanged, but the fundamental situation for the gas market just looks weak.
Monday 11th February 2019 - Gas prices closed down, as the weight of oversupply and weak winter demand continues to grind on. This morning, the system is short which will give storage holders a reason to unwind some stocks, oil and coal prices are down with the latter taking a pretty hard smack in early action. The weather forecasts have continued to hold above normal and without the winter demand bearish pressure will continue.
Tuesday 12th February 2019 - Gas prices were dealt lower in the UK on Monday with most of the losses concentrated on the spot and at the front of the curve. This morning, the system is marginally short as both demand and supplies to the UK drop to find a balance as temperatures improve. Oil, coal, power and gas are all marginally up in early trade action, equity markets in Asia are up marginally signalling a positive open for Europe, while the euro is gaining against the dollar.
Wednesday 13th February 2019 - Gas prices were barely changed throughout yesterday’s trading session with prices wavering between minor increases and losses throughout, as traders focused on gains in the oil market, that all changed shortly before the close when Carbon prices plunged 8% taking power and gas into negative territory for the close. This morning, the system is marginally long, temperatures are climbing, and renewable output is falling.
Thursday 14th February 2019 - Gas prices recovered yesterday after starting the day lower. Strength in crude, coal and carbon fuelled a bullish mood and short-sellers covered profitable positions. Weather forecasts are coming in a touch cooler than previous days providing some support to the market, bullish oil and hopes for a trade break-thru with China. Gas continues to trade around the previous close with minor losses in the spot.
Friday 15th February 2019 - Gas prices were down yesterday while curve prices made increases throughout the morning and early afternoon before giving back much of the gains to close relatively flat day-on-day. This morning, the system is balanced, and 3 LNG cargos are docked and unloading into the UK, another 3 arrivals are expected before the end of the month. Weather forecasts show a minor dip in temperatures into the middle of the 15-day outlook, however none of the forecasts are predicting temperatures below normal.
Monday 18th February 2019 - Gas prices closed up on Friday’s session, supported by increases mode in coal, oil, power and carbon. Despite bearish fundamentals for the European energy complex, high stocks, mild weather and a slowing economy, increases could continue this week as the bullish sentiment from OPEC+ supply cuts and positive news out of trade talks between China and the US sets the narrative. This morning, the system is slightly short, however with a surge of LNG arrivals to the UK gas is available. Weather forecasts remain mild with temperatures above normal expected into the first week of March.
Tuesday 19th February 2019 - Gas prices were distributed lower on Monday, taking much of the European energy complex lower with them. This morning, the system has swung to marginally long and LNG send-outs have stepped up from the weekend. Renewable power generation is expected to peak int the coming days with a peak in unseasonable mild temperatures. Gas contracts are trading around the close of business prices from yesterday in thin volume.
Wednesday 20th February 2019 - Gas contracts dealt sideways throughout most of yesterday’s session before finding their feet in the last hour to power to a day-on-day increase in the close. This morning the system is balanced, weather forecasts for the UK are a touch cooler into March and oil remains sideways. Gas is trading mostly flat to yesterday’s close, carbon is down, coal is flat and power is sideways.
Thursday 21st February 2019 - Gas prices were higher yesterday in both the UK and on the continent, on what appeared to be a mini-short squeeze, where short sellers drive up the market as they try to exit their positions on mass. This morning, the system is long, weather forecasts have been revised a touch warmer and the API (American Petroleum Institute) forecasts an announced build in US crude stock piles. Coal, carbon and power are trading lower with gas while oil is sideways.
Friday 22nd February 2019 - Gas prices took a crushing yesterday, the system was long throughout the session and weather forecasts have been revised slightly warmer in the 10-day outlook, while additional LNG cargos were added to the list of expected arrivals. This morning, the market remains soft, the system is slightly short while coal and carbon are trading marginally lower with gas and power. News from the US/China trade front and a possible BREXIT delay could lead to modest market gains on normalizations of trade and stabilizing the global economy.
Monday 25th February 2019 - Gas prices were dealt lower on Friday as selling pressure continued to mount on continued mild weather, continued LNG arrivals and a generally bearish European energy complex. This morning, the system is a whopping 31mcm long as demand remains weak and supplies strong.
Tuesday 26th February 2019 - Gas prices dipped on Monday, on the back of an oversupplied spot market coupled with bearish sentiment from a more than $2 move in the price of oil. This morning, the system is again oversupplied albeit less so than on Monday. Coal and carbon prices are up marginally while gas and oil prices are slightly down. Today all eyes will be focused on the Trump-Kim summit in Vietnam.
Wednesday 27th February 2019 - UK gas prices were slightly down yesterday, because of a stronger pound and a well-supplied system, by contrast continental prices were mixed with very minor increases/losses across the curve. This morning, gas is playing catch-up to the moves of the complex yesterday, in addition, coal carbon and oil are all up today making for a minor rebound in the bearish trend the markets have been in for the past 3 months.
Thursday 28th February 2019 - Gas prices made increases from the start of yesterday's session until the bitter end. This morning, the system is balanced, oil has retraced a bit of yesterday's gains and gas is offered around the previous close. For the first week of March, 5 Q-Max cargos are expected to the UK, so the market should remain very well supplied, helping to limit upside moves.
Market Comments March
Friday 1st March 2019 - Gas prices rose vigilantly yesterday, keeping pace with the broader European energy complex which saw increases in power, carbon and coal. Weather forecasts have been revised a bit warmer and with more wind which is expected to put pressure on spot prices, the risk of a late winter cold snap continues to diminish. Gas prices are down slightly, as power and carbon get dealt lower, coal trades sideways and oil makes some modest gains.
Monday 4th March 2019 - Gas prices fell on Friday in to the close of the week with pressure coming from the front end of the curve. Weakness in gas has been driven by constant arrivals of LNG and mild weather both of which are set to continue into the month of March. This morning, the system is slightly short, however with 3 LNG arrivals to the UK over 3 days. Coal, power and carbon are lower while oil and the pound are a touch stronger, gas is trading just slightly below the previous close.
Tuesday 5th March 2019 - Gas prices were stable, which was the most bearish part of the European energy markets which saw coal, power and carbon rally while oil made modest increases. This morning, the system is slightly short, but should come into balance quickly with a little help from the LNG operators. Gas prices are up with coal, power and carbon while oil is dealing slightly lower.
Wednesday 6th March 2019 - Gas had a bearish day yesterday posting losses across the curve. A large sell-off in coal and the first down-day for carbon in 8 days were some of the bearish input to European gas markets. The general supply picture still looks more than healthy with lots of LNG coming to Europe and high flows from both Russia and Norway. Dutch production is down year on year, but this is expected due to the ramping down of Groningen.This morning we see the market open lower on continued warm and windy weather, and slightly lower coal and carbon.
Thursday 7th March 2019 - Gas had another bearish day yesterday, again posting losses across the curve. A further sell-off in coal and a correction in carbon sent European gas markets down. This morning we see the market open lower on continued warm and windy weather, and slightly lower coal and carbon.
Friday 8th March 2019 - Gas prices relaxed further yesterday although only modestly, the rest of the European energy complex continued higher, particularly power which has been following the machinations of emissions credit prices more than actual feedstocks. This morning the system is balanced, renewable generation is healthy which should keep the need for gas to a minimum for power generation.
Monday 11th March 2019 - Gas prices were steady on Friday, with little change in value on either the continent or in the UK. This morning, the system is balanced, while weather forecasts have shifted warmer than the outlooks on Friday, coupled with the predictions for warmer temperatures are increased wind and solar production.
Tuesday 12th March 2019 - Softness continued in the gas markets around Europe and the UK, as mild weather and strong wind kept demand in check while supplies remained robust. This morning, the system is long, however the complex is up as oil leads with increases, coal and gas follow and power and carbon pile on.
Wednesday 13th March 2019 - Gas prices continue under pressure having fallen again yesterday in both the UK and on the continent. Pound volatility caused some intraday noise in the market, but the fundamentals won out pressuring prices down despite some minor increases in coal and oil. This morning, the system is almost balanced, weather forecasts remain mild and the output of renewables is expected to hold up into the weekend.
Thursday 14th March 2019 - Gas prices were lower on Wednesday as bearish traders sold markets off as the winter comes to a close with storages brimming while pipeline and LNG flows continue unrelenting. In addition, to weak gas demand, demand for coal fell sending prices lower as the fuels compete for the favour of power demand which itself was low on renewable generation. This morning the market is taking a breather gas is trading close to the close, with power, coal and oil creeping higher gas may finally have a retracement of its own.
Friday 15th March 2019 - Gas prices remain under pressure as the week's trading is about to come to an end, despite some increases in coal, power and carbon, the gas markets drifted lower with oil and a falling price for LNG in Asia. This morning, the system is long as demand softens, and supplies remain firm. The broader energy complex is slightly up with coal, oil, power and carbon all making minor gains in early trade.
Monday 18th March 2019 - Gas contracts were distributed lower on Friday capping off a week of losses for the market, gas was not alone, coal, power carbon and even oil closed lower on the day. This morning, the system is short 20mcm, more than it has been on almost any day this year. The shortfall in gas may provide a chance for the bulls in the market to make up some lost ground and push prices back up a bit, supplies remain mostly unchanged while demand has increased on a drop in wind output, shifting demand to gas fired power generators, and a short term drop in temperatures.
Tuesday 19th March 2019 - Gas prices closed lower on the exchanges yesterday, however, late session buying in the bilateral markets saw prices close higher marking the first increase in over a week. A short term reversal may be in order as a market that is very short could see traders close positions and squeeze the market to the upside. Fundamentally the market remains well supplied save for yesterday and today where the system has been short at the open on a few minor outages. Gas prices are up in early trading action with the broader energy complex.
Wednesday 20th March 2019 - Gas contracts staged a rally to start the session off yesterday, gaining on the back of a short system and fuelled by short covering. This morning, the system is balanced, weather forecasts are a touch warmer and there is a bit more wind and solar expected next week, demand in the UK falls below the seasonal normal. Contracts are trading around the close in early action, carbon and power are down, oil is up, and coal is neutral.
Thursday 21st March 2019 - Gas prices united yesterday to close higher, after starting the day tracking new lows. Strength in the broader complex, increases in oil on a massive stock draw coupled with increased coal, power and carbon was too much for the market to shrug off. This morning, gas traders are indecisive, trading flat to the previous close, coal and oil are mostly unchanged with only German power and carbon trading perceptibly lower. The system is balanced, and weather forecasts are coming in a touch warmer and windier.
Friday 22nd March 2019 - Gas prices retraced much of the increases from the previous day to close with the broader energy complex, coal and oil were dealt lower while power and carbon followed. This morning the system is balanced, demand is dropping more than 22cm below season normal on mild weather. Weather forecasts are coming in a touch warmer than yesterday with modest increases in wind.
Monday 25th March 2019 - Gas prices dropped further on Friday, on robust supply and lower demand coupled with a weaker commodity complex where both coal and oil were dealt lower. This morning, the system is long 15mcm, flows continue to hold up from Norway at winter levels while Russian flows soften slightly; LNG send-outs remain robust. Weather forecasts continue to oscillate between seasonal normal and above with moderate wind and solar.
Tuesday 26th March 2019 - Gas prices dipped lower yesterday, on the back of an over supplied system and falling demand, this despite increases across the commodity complex where both coal and oil were lifted. This morning, the system is slightly short as supplies have dropped a bit faster than demand. Weather forecasts have turned a touch cooler with a dip below normal expected during the first 7 days of April in the UK and a return to normal for most of the continent, renewables are expected to perform around average.
Wednesday 27th March 2019 - Today availability is short, which is mainly due to lower send out from LNG terminals. LNG stocks have been drawn down lately but looking at the list of LNG ships still on the way to Europe, the send out is likely to increase again soon. We are looking at a slightly colder period ahead of us, and we expect both LNG terminals and storages to take the opportunity to extract some of the gas still in storage to make room for injections during summer.
Thursday 28th March 2019 - Gas prices staged a rare rebound yesterday on the back of a tight supply/demand balance and cooler than normal forecasts. The strength was not supported by the broader complex, both coal and oil dipped, but with a very bearish market, many players in sort positions come to cover with any up move, the trend remains intact and the fundamentals unchanged. Seven LNG cargos will arrive to the UK during the first week of April in time to find demand that is slightly higher. This morning, despite a sort system the market is trading slightly below the close from yesterday. Both coal an oil are dealing slightly lower; political turmoil is weighing on the pound.
Friday 29th March 2019 - Gas contracts dealt lower into the second last day of trade for the April, Q2 and Summer 2019 contracts, with expiry set for today the downward pressure continues. Weakness in coal and moderating weather conditions gave way to more bearishness. This morning, the system is long despite a sharp drop in demand. It looks to be a relatively quiet end to the winter contracts and a bearish start to summer trading.
Market Comments April
Monday 1st April 2019 - Gas prices closed the month, quarter and seasons somewhat lower on Friday, the broader European energy complex dropped with coal off over a dollar and carbon down almost 75 cents. This morning, the system is long, almost 20cm, temperatures are above normal and are expected to remain so for most of the forecast. Gas, coal carbon and power are all trading down in early action with only oil making gains.
Tuesday 2nd April 2019 - UK gas prices continued under pressure for the first day of the gas summer season, on the back of an over supplied system and the start of exports to the continent and injections to UK storages. This morning the system is again over supplied despite export to the continent and modest reductions in both Russian and Norwegian flows. Gas is trading slightly down from yesterday's close aided by a weaker power market and generally mild temperatures to come.
Wednesday 3rd April 2019 - Summer gas prices tumbled yesterday on the back of an oversupplied system and healthy send-outs of LNG. This morning is shaping up in a similar manner, the system is almost 30mcm long despite higher than normal demand and healthy exports to the continent. Flows remain robust from all sources and storages have begun injections in earnest. Gas contracts are trading around the close while other commodities are slightly up including coal and oil, German power and carbon.
Thursday 4th April 2019 - Gas prices recovered yesterday with power and carbon as the European energy complex rebounded after weeks of persistent losses. This morning, the system is slightly long despite increased exports. Ten LNG cargos are expected to arrive in the UK over the next 15 days, this should keep send out high with storages having the opportunity to inject any spare volumes.
Friday 5th April 2019 - Gas prices overturned early losses yesterday and ended the day with significant increases. The rise was led by carbon, that added more than €1/ton to the Dec-19 contract that traded through several technical levels. Coal also traded up, and oil was strong during the day. During the night, we have seen a ~15% drop in Norwegian flows to Europe. The system is now slightly short. This has sent gas prices up further this morning with May-19 having traded as high as 39.35. It has already retraced somewhat from there, and so we seem to be in for a volatile day.
Monday 8th April 2019 - Gas prices rallied on Friday, squeezing traders shorts out and driving buyers to the market in a panic. Buying interest from previous days, earlier in the week coupled with a hiccup in intraday flows from Norway seems to have been the spark that triggered the correction. Today, flows have returned to normal levels from last week, the system has flipped to modestly oversupplied despite robust exports and weather forecasts remain mostly unchanged, mild with a short lived dip to below normal temperatures later this week. Prices are down slightly in early trade action as market participants are feeling out these new price levels.
Tuesday 9th April 2019 - UK supplies drop off faster than demand despite continued exports to the continent. Coal and carbon prices are slightly higher than yesterday's close while oil is dealing a touch lower. Gas prices are up on the supply tightness but have not regained all that was lost the previous day.
Wednesday 10th April 2019 - A spring cold snap and some minor supply issues in Norway may have kicked off some buying last week, however the moves do not have the backing of the fundamentals which include mostly balanced flows, continued high imports from Norway, Russia and LNG send-out coupled with robust storage levels and a long list of expected LNG deliveries. The biggest moves have been focused on the spot, balance of summer and Winter 2019, while the rest of the curve has moved up in sympathy the moves from Summer 2020 have been more mutes. Today, the system is short, modestly, and prices are up are mere1.5p/th across the curve or about 0.50 euros/MW. Volatility in the EU gas and carbon market continues this morning enabling API2 coal to follow in its slip-stream.
Thursday 11th April 2019 - Gas prices dropped as buying interest decreased yesterday and the bears took control of the market for the day, the upcoming Easter holiday week (lower demand) coupled with interconnector maintenance (reduced export capacity) and forecasted warm windy weather (reduced demand for gas in the power sector) could be re-entering the minds of traders. This morning, the system is marginally oversupplied, oil and coal are down while carbon is sideways. Gas prices are a touch softer with pressure being applied to the spot and front month.
Friday 12th April 2019 - UK natural gas prices corrected downwards in early Thursday trading as bearish fundamentals shrugged off a strong energy complex. The British system was oversupplied throughout the morning, despite demand climbing around 70mcm above seasonal norms amid cooler temperatures and low renewable energy production. UK temperatures are expected to remain below average for the remainder of the week, before climbing above seasonal norms from Monday onwards. The bearish momentum was short-lived however as attention returned to a bullish energy complex in the afternoon. European carbon prices traded above €27/tonne for the first time since mid-2008 amid speculative buying interest and strength in coal markets.
Monday 15th April 2019 - Gas prices softened into the close on Friday after a choppy week with pronounced intraday volatility, pressure came from the fundamentals however support could be found in the broader energy complex where oil, power and carbon made increases. This morning, the system is long, temperatures are returning to normal and flows remain robust. Gas contracts are dealing lower in early trade action, volumes are expected to wane into the week due to Easter holidays.
Tuesday 16th April 2019 - Gas prices were distributed lower on Monday as temperatures returned to normal and demand faded into the Easter holiday week. This morning, the system is slightly short as temperatures continue to climb, flows remain robust from all sources, however, a dip in flows from Norway to the UK accounts for the undersupply. Coal, oil and carbon are trading flat to slightly lower at the open while gas is up slightly driven by the tightness in the spot market.
Wednesday 17th April 2019 - Gas prices dealt down early yesterday before recovering into the close, prices were mostly unchanged day-on-day. This morning, oil, coal, gas, power and carbon are all trading up modestly. Trading volume dropped yesterday and is expected to be low today and tomorrow as we move into the Easter holiday with markets being closed both Friday and Monday. US oil data comes out this afternoon with a draw in stock piles expected, this has already moved crude to $72/Bbl.
Thursday 18th April 2019 - The European energy complex was up yesterday as increases in coal, carbon and power led to buying in gas, short sellers appear to have lost some confidence in the sell-off and likely began taking profits ahead of the holiday long weekend amid a mostly bullish turn in technical indicators. This morning, the system is again short despite the mild weather, although low wind output does help with some demand. Forecasts have shifted slightly warmer out to the end of the month, an unplanned outage in Norway has lifted prices in early trade action, coal and power follow, carbon and oil are slightly lower.
Tuesday 23rd April - Gas prices sank on Thursday, ahead of the Easter long weekend, driven lower on realized fundamentals, weakened demand, mild weather and robust supplies. Today, the system is 35mcm long as the interconnector is down for its annual 2 week maintenance, which traps excess gas in the UK with no manner for export. Gas demand in the UK is expected to decline from 192mcm on yesterday to 186mcm on today, 14mcm below the normal seasonal demand. Gas prices are down slightly in early trading accompanied by softer carbon and power prices, oil prices are climbing on news that the US will not continue its wavier program for Iranian oil.
Wednesday 24th April 2019 - Gas prices cratered in the spot on the first day of interconnector maintenance, falling over 6p/th, the curve dropped early in sympathy but was bought up early on with contracts closing flat to slightly up. This morning, the system is only marginally long, storages in the UK have jumped almost 20% as spare gas is injected during maintenance. Gas prices are up marginally, lead by relative strength in the spot market from a smaller over supply.
Thursday 25th April 2019 - European gas markets were undecided on the direction for most of the day. It wasn’t until a late sell-off in coal, that gas decided to go down. Coal fell more than 2 $/ton as stocks at European parts are surging. Low demand for the fuel in Europe puts a bearish pressure on market. Carbon also fell, but only slightly and oil ended the day unchanged. Continued deliveries of LNG continue to keep prices in the front subdued, while contracts further out haven’t taken as much input from the weak front. This morning the system is only slightly long. Gas contracts have opened the day slightly up reversing some of yesterday’s late sell-off.
Friday 26th April 2019 - Gas prices traded sideways for a third session yesterday, finishing the day only slightly up from the previous close. This morning, the system is slightly short but with 3 LNG cargos expected over the weekend the tightness of the market is likely going to be short lived. There is a slate of 12 LNG cargos expected to the UK over the next 2 weeks, while weather forecasts expect temperatures to dip below normal a couple of times over the 15-day outlook.
Monday 29th April 2019 - Oil led declines in the global commodity complex falling over $2/Bbl on Friday, taking coal, gas, power and carbon down with it. This morning, the system is slightly short, owing to a minor drop in supplies from Norway, Russian and LNG flows remain stable. Stock levels have hit 60% full in Germany while Europe, is closing in on 50% full. Temperatures are expected to be slightly above normal for the 15-day outlook with a brief period of below normal temperatures over the coming weekend.
Tuesday 30th April 2019 - Yesterday’s market was pushed but by the close left mostly unchanged. Global commodities went in different directions with oil and coal dipping, while carbon and power rallied, gas was a rudderless. This morning, the system is balanced, flows are broadly unchanged, spot prices are up forecasts have been adjusted slightly cooler and renewables are expected to underperform until the weekend. Oil is up, coal is down, power is sideways, and gas is flat, carbon looks to test resistance at 26 euros, a break to the downside might stir some emotions.
Market Comments May
Wednesday 1st May 2019 - Gas contracts traded down late in the session yesterday just ahead of contract expiry as flows started to pick up after some unplanned outages in Norway. This morning, the system is almost 30mcm long despite slightly cooler weather . The pipeline is UK’s export route to the EU until July, when the BBL becomes bi-directional, exports were around 30mcm/ day before the annual maintenance. Prices are a bit softer this morning in early trade action, coal, oil, power and carbon are also down.
Thursday 2nd May 2019 - Gas prices came under pressure yesterday, moving lower with coal, carbon and power and on the back of an oversupplied system. This morning, the system has dropped into undersupply, struck by an unplanned outage in Norway, which has cut flows by 20mcm. LNG arrivals remain high with expectations for 12 vessels for the first half of the month, weather forecasts predict a spring chill over the weekend with a corresponding increase in wind production before a return to seasonal normal temperatures.
Friday 3rd May 2019 - Gas prices moved up for the spot and balance of summer contracts yesterday on the back of a tight system and a spring chill expected to last over the weekend. This morning, the system is long, flows from Norway have picked up and exports have maxed out leaving the system to balance itself with storage or diversions. Oil remains under pressure in early trade action while the European energy complex is trading around the closing prices for the respective commodities.
Tuesday 7th May 2019 - The UK was closed for a bank holiday yesterday so only spot trading occurred. This morning, the system is marginally short, on the back of chilly weather despite strong receipts of Norwegian gas, exports from the UK to the continent remain high, close to maximum capacity. Weather forecasts predicts cooler temperatures for the continent for the 15-day outlook averaging a couple degrees below normal while the UK is expected to return to above normal conditions by the weekend.
Wednesday 8th May 2019 - Trade action was varied yesterday in the gas market with an early morning rally which lifted all contracts save for the spot and balance of summer, by the afternoon the market turned and a sell-off began leaving the front end of the curve and spot prices much lower while seasonal contracts held some modest gains into the close. This morning, the system is long, and the European energy complex is down save for Brent crude which modestly up after yesterday's session.
Thursday 9th May 2019 - Gas prices were up on Wednesday driven by bullish spot due to cold temperatures and low power production from wind and rallying carbon prices. Gas demand in the UK is expected to decline further in the coming weeks as temperatures gradually warm up and heating demand disappears. On the continent, however, another cold spell will hold the demand on a relatively high level for the next week. Gas prices are up in early trading accompanied by stronger carbon and power prices.
Friday 10th May 2019 - Below average temperatures and an unexpected outage in Norway supported front contracts yesterday. Longer dated contracts took inputs from bearish coal and carbon markets, that both fell. This morning flows from Norway have dropped further as we enter a period of larger planned maintenance, and it has left the system slightly undersupplied. Front contracts are marginally up and so is the curve.
Monday 13th May 2019 - Gas prices dropped on Friday after a bumpy week of ups and downs, a drop in power prices rising temperatures and a loosening of the supply/demand balance led to the retracement. This morning, temperatures continue to rise, the system is well oversupplied with volumes of 30mcm in excess. Prices are lower from spot to curve in early trade action.
Tuesday 14th May 2019 - Gas prices had additional discounting yesterday in the spot market and on forward contracts for the balance of the summer, longer dated seasonal and calendar products were unchanged from Friday. This morning, the system is long as temperatures continue to rise in the UK while temperatures on the continent continue to be below normal with a return to seasonal conditions set for the weekend. Prices for gas are down in the spot and the balance of summer while the front season is flat to the close.
Wednesday 15th May 2019 - Gas prices recovered all along the curve save for the spot, which was over supplied throughout the session from start to finish. This morning, the system is again long as temperatures rise across continental Europe and demand for power generation wanes on an uptick in wind and solar power production. Oil is trading a touch lower this morning, as is coal, the power markets are being led higher in early action by carbon which is testing the 26 euro level again and gas is flat.
Thursday 16th May 2019 - Gas prices dropped throughout the first half of the day before recovering in the afternoon to post increases on the back of a surge in oil prices which brought the whole commodity complex, gas, coal, power and even carbon, to close in the black on the day. This morning, the system is long again, however, by a more modest margin, temperatures continue to climb on the continent and remain around the seasonal normal for the UK.
Friday 17th May 2019 - The overall perspective, gas fundamentals look very strong particularly due to large amounts of LNG coming to Europe. The UK has already received more than three times as much US LNG compared to last year, as a result the market opens marginally down today
Monday 20th May 2019 - Gas prices closed down on Friday, taking on fresh lows for the balance of summer contracts, with June dipping below 30p/th. Mild weather and weak demand in the face of robust supplies have been grinding prices lower and lower as we move into the summer. A sell off in the broader energy complex helped to propel prices lower, however, longer dated contracts remain above their lows from April where they have garnered support from oil. This morning, the system is a bit short on the back of a reduction in flows from Norway, stocks across Europe are more than 50% full with Germany reporting stocks are 35% more full than last year at 65%. Expect price action on the balance of summer to be under continued pressure for the balance of the month as Britain welcomes 7 more LNG vessels by the end of the month.
Tuesday 21st May 2019 - Gas trading yesterday resulted in little change to the direction of prices with contracts diverging along the curve and between markets. This morning, oil is up slightly, while carbon and coal are slightly down. German power is mixed with UK and Nordic yet to trade. All of this has left gas to chart its own course and this is tentatively lower in early action.
Wednesday 22nd May 2019 - Gas prices were dealt lower yesterday on the back of an oversupplied spot market, rising coal and oil prices were shrugged off by the market in favour of the fundamentals. This morning, the system is balanced, hiding the fact that flows to the UK from Norway have dropped by 24mcm, more than 10% of total demand in the UK. Exports to the continent remain unchanged as UK storage stocks remain above the 5-year average and well ahead of levels from last year.
Thursday 23rd May 2019 - Gas prices rebounded yesterday on the back of an undersupplied spot market, despite falling coal and oil prices, fundamentals ruled the day. This morning, the system is long, flows to the continent from Norway have dropped by 43mcm, however, the UK cannot export more via the ICUK. Around the broader markets, oil and coal are down, the European energy complex, gas, power and carbon credits are all trading down from the previous close.
Friday 24th May 2019 - Gas prices were unaffected on the spot and curve yesterday in both the UK and on the continent. This morning, the system is balanced, demand is easing off with mild sunny weather, oil is having a very minor rebound, while coal and German power are down. Gas prices are slightly positive in early trading, though only marginally with the front month contracts set to expire next week.
Tuesday 28th May 2019 - Gas markets were closed yesterday for the UK bank holiday with limited trading on the Over-the-Counter markets only. This morning, the system is balanced, demand has picked up with a modest dip in temperatures, however supplies have followed to match it. Oil rallied during the bank holiday Monday but is trading slightly lower this morning.
Wednesday 29th May 2019 - Gas prices recovered on Tuesday despite flatlining markets for coal, oil and carbon. This morning, the system is in a marginal surplus as temperatures begin to moderate, storages continue creep higher. Weather for the weekend and next week has been revised warmer which should cut demand further. Gas markets are slightly softer in early trade action while coal, oil and power are also slightly off from yesterday's closes.
Thursday 30th May 2019 - Gas prices dropped yesterday, driven down by weakness in the spot market, which was oversupplied throughout the day as temperatures began to rise and demand to sink. This morning, most of the continental markets are at half staffed as the observance of the Abstention holiday takes place, only the Nordic power market is closed while the rest are expected to trade with very low volumes. A quiet start with gas trading flat to the previous close, the system is balanced, and weather forecasts are broadly unchanged.
Friday 31st May 2019 - Gas prices were down yesterday, with weakness for the curve being driven by the spot and front month. This morning, the system is short, however, this is unlikely to spark a rally as oil is down a dollar and carbon and power are trading at a discount. Gas prices are a touch softer as the markets for gas are fully open today, albeit lower volume is expected due to the bridge holiday.
Market Comments June
Monday 3rd June 2019 - Gas prices were dealt a heavy blow on Friday as the June contract expired, weather warmed, and storages swelled. This morning, the system is a whopping 48mcm long, maintenance on a connection point in the Netherlands has closed off flows from Norway to the continent, which have been rerouted to the UK causing the length, expect storages and export capacity to work throughout the day to deal with the excess gas in the market.
Tuesday 4th June 2019 - The general sentiment is weak. Trumps aggressive economic policy against e.g. China and Mexico makes investors cautions and it all spirals into a situation with downward pressure. The mild winter combined with more LNG export facilities being operational has resulted in significant amounts of LNG coming to Europe. With seven LNG vessels expected to arrive to Europe before June 20th the ample supply situation doesn’t seem to change in the short term. This morning prices opens marginally up compared to yesterday’s close.
Wednesday 5th June 2019 - Gas prices recovered yesterday, driven by a move on the spot which boosted the cost for the balance of summer contracts. This morning, the system is balanced, oil is down slightly on expectations of a large build in US stocks while coal, power and carbon are trading sideways in early market action. Gas prices are down slightly on the balanced system, stock markets are up, and storages fill as LNG vessels continue to arrive.
Thursday 6th June 2019 - Prices came off again yesterday after the rebound on Tuesday. This morning the market is long, but as we have covered previously, we have reached levels in the front, where US LNG is going to struggle to make its way to Europe. With the sharp increase in prices for the later summer months and into the winter, we should still see plenty of LNG later in the year. The market is trading flat to yesterday’s close.
Friday 7th June 2019 - Gas prices were unaffected yesterday, but during the afternoon, the front gave in to the still massive supply of gas from various sources. Oil has traded higher during the night, and coal is opening up ~1 $/ton. With slightly higher carbon, and a tight front, we see gas prices moving up this morning.
Monday 10th June 2019 - Gas prices united on Friday, gaining in the spot market on an undersupplied system. This morning, the system is modestly short, oil is off slightly while coal, power and carbon are all trading up. Gas is trading flat in thin volume with yet another European holiday today, Whit Monday, many traders are out of office with only skeleton crews on the desk.
Tuesday 11th June 2019 - Gas prices moved higher yesterday during thin trade over the Whit Monday holiday, the broader European energy complex was strong, the gas spot market was tight on reduced flows of LNG. This morning, the system is again short as additional planned maintenance cuts the flows to the UK from Norway while demand remains well above seasonal normal levels.
Wednesday 12th June 2019 - Soft open on the NBP this morning with losses in wider commodities driving the curve downwards. A weaker oil demand outlook as a result of the global economic slowdown coupled with a rise in US inventories has driven oil to around $60.69/bl. Both coal and carbon EUA’s are also trading downwards following movements in gas and an oversupplied coal market. The UK has only had one cargo this month with another vessel confirmed to hit South Hook on the 21st.
Thursday 13th June 2019 - Today, the system is again short and will look to make up 16mcm of demand throughout the day as falling supplies against robust demand in a cool soggy UK market are to blame. Help should be on the way as mother nature is forecast to warm temperatures up next week and 7 LNG vessels are expected to arrive to British terminals over the next two weeks. Oil has rebounded by almost $2 this morning on reports on an oil tanker on fire in the Gulf of Oman.
Friday 14th June 2019 - Gas prices united early yesterday on the back of the 2 oil tanker attacks in the Arabian Gulf, selling off from their highs in the afternoon to close the day modestly higher. Today the system is short, both demand and supply well above seasonal normals, robust exports coupled with soft inflows of LNG for the UK, while, on the continent LNG imports expand as storages continue to fill.
Monday 17th June 2019 - Gas prices closed lower on Friday, despite a late session upsurge as the session came to a close. This morning, the system has fallen short on an unplanned outage in Norway, planned maintenance begins today on the Kollsnes processing plant cutting throughput until the end of the month. A pipeline diversion, due to maintenance is driving almost 60mcm through the UK to the continent due to closure in Zeebrugge, Belgium.
Tuesday 18th June 2019 - Gas prices united on an undersupplied system which pulled up the front end of the curve while weak oil and coal prices kept gains on the longer dated contracts to a minimum. This morning, the system is almost 30mcm short on maintenances works, unplanned maintenance at the Nyhamna processing plant was extended to late Tuesday. Oil prices remain under pressure on a global oversupply, coal is down, power and carbon are sideways while gas is up modestly.
Wednesday 19th June 2019 - Gas prices softened yesterday drifting towards the lower end of their near-term range, in particular, Win-19 is edging close to resistance at the psychological level of 50p/therm. This morning, the system is balanced, coal and carbon are down while oil and power are slightly up, gas is offered on at the closing price from yesterday. Expect the UK to see some more arrivals of LNG next week after a 2-week drought.
Thursday 20th June 2019 - With losses to all inputs for European gas it had nowhere to go but down. This morning the system is slightly undersupplied, but 4 big LNG ships are expected to arrive in the UK in the coming 8 days. The market is slightly up on the undersupplied front, but also on a jump in both coal and oil. For the gas market it will be interesting to see if the Win-19 NBP contract can break the 50 p/th resistance level. It has changed hands at this level this morning.
Friday 21st June 2019 - Stronger oil and coal on the back of Iran shooting down a US drone was the primary driver behind a stronger back end of the gas curve yesterday. This morning we see oil easing off the 65 level and trading around 64 $/bbl. Coal and carbon are unchanged. The system is balanced today, but gas opens down. It looks like the 50 p/th level on the Win-19 is going to be tested once again.
Monday 24th June 2019 - Gas prices dropped on Friday testing 2019 lows before rebounding late in to the close of trading, a bounce in oil and coal has been highlighted for the move along with geopolitical sabre rattling between the US and Iran. This morning, the system is balanced despite a sharp drop in Norwegian production from planned maintenance, 55mcm cut. Gas is trading sideways, oil is modestly higher, power is gaining, and coal is unchanged.
Tuesday 25th June 2019 - Yesterday was a split market with spot and balance of summer falling while longer dated contracts gained. A change in carbon prices drove demand for longer dated power contracts which also supported the gas, coal was only modestly up while oil closed lower. This morning, the system is almost balanced coming in slightly short because of unplanned Norwegian maintenance, LNG is on the way for the latter part of the month.
Wednesday 26th June 2019 - Wednesday’s gas market has opened with losses this morning despite opening with a short system and EUA’s and Oil prices moving up.
Thursday 27th June 2019 - Bullish oil, carbon and coal pulled up lengthier dated contracts while the front is still under pressure from the massive length of gas in the front. It is worth noting, that carbon continues up. It broke out of a sideways channel on Monday and yesterday it tested the 27.5€/ton level. A massive heatwave over Europe is increasing fuel burn and increases the risk of higher temperatures in rivers across Europe that caused nuclear cooling problems last year in several European countries, France in particular. This morning the system is slightly under-supplied, but still lots of LNG on its way to Europe, and we see front contracts open lower. The curve is still to open, but with carbon, coal and oil slightly lesser than yesterday’s closes, the arrow points to a soft open.
28th June 2019 - European gas markets went down yesterday as carbon fell 0.5€/ton and coal failed to break the 65$/ton resistance level. Though it is still warm in many parts of Europe, wind is also picking up, increasing the output from renewables. Also, temperatures are expected to decrease during next week, giving some respite to heated areas. This morning coal and carbon are further off and so is the gas market.
Market Comments July
Monday 1st July 2019 - Gas prices fell further on Friday as carbon lost more than 0.5 €/ton, and oil also ended the week down. Only coal was the black sheep amongst the input and managed to close in positive territory. The Win-19 contract closed just below the 50 p/th support level for the 2nd time this year, and this week we will see if it has finally broken this level. If confirmed today, it could open up for more shortcoming. Despite more Norwegian maintenance since Friday, the system is long today. Supply from LNG terminals seems to have risen slightly. But one thing to notice is, that a few empty ships have started to emerge in the horizon, heading for Europe. The spread to reexport LNG to Asia has opened up again, and this should give some support to front contracts. Gas is yet to open, but coal, carbon and oil are all up since Friday.
Tuesday 2nd July 2019 - As mentioned yesterday, we are starting to see a few empty ships on their way to Europe. The arbitrage to Asia has opened up again, and we are now seeing re-exports from Europe. This limits the weakness on the front, and yesterday we did see the front increasing. The curve remained the same, despite bullish moves in both oil and CO2. CO2 bounced more than 0.5€/ton yesterday and is still very unpredictable. Coal ended unchanged. Front seasonal contract is still clinging on to the 50 p/th support level, closing only just below yesterday. As mentioned, the front is up this morning. System is slightly undersupplied. Carbon is rising further giving some support to the gas market, where most contracts trade up.
Wednesday 3rd July - It seems the market finally broke the 50 p/th support level for the NBP Win-19 contract. At least the market closed around 48.50 p/th yesterday, in a generally bearish day for European gas. Yesterday oil, coal and carbon fell, adding to the bearishness of gas markets. Oil fell more than 2.5 $/bbl. despite the OPEC+ agreement to prolong production cuts for another 9 months. Today oil trades steady, coal and carbon are also unchanged. Several unplanned outages and continued export to the continent has left the UK system undersupplied this morning, and LNG terminals will have to increase regasification.
Thursday 4th July 2019 - Yesterday, the front contracts continued their rally and gained almost half a penny day on day. The system was undersupplied due to ongoing maintenance work and an outage at Kollsnes processing plant. The supply situation is primed to get better over the next days, as the outage has been resolved and maintenance ends at the Troll field. Prices for longer dated contracts fell with Win-19 leading the curve lower. Traders start to question the justification of the risk premium that is currently priced into the front winter contract. The first trades this morning point to a weak start into the day, despite the short system.
Friday 5th July 2019 - The day-ahead contract lost 0.25p/th, to 27.00p/th, weighed down by an expected drop in demand and stronger flows through the Langeled pipeline. Langeled flows are expected up today as the scheduled maintenance at the Troll field has come to an end. Some flows are still curtailed however, with an unplanned outage at Nyhamma (impacting 18mcm/d) lasting until the 11th July, whilst there is also a small outage at Karsto. Curve contracts saw a jump yesterday, rebounding somewhat from heavy losses seen earlier in the week.
Monday 8th July 2019 - The front of the curve rose up on an extended outage at the Nyhanma processing plant. The front month contract surged by more than 10% intraday and closed 2.57 p/th above Thursday. Over the weekend, the volume of the outage, that will last until end of August, was lowered from 18 mcm/d to 9 mcm/d. The seasonal contracts posted modest gains driven by the surge of the prompt and advancing carbon and coal prices. This morning the bulls stay in control. The first trades of the Aug-19 contracts are conducted above the 30 p/th level.
Tuesday 9th July 2019 - Yesterday prices across the curve rallied for a second day. The front month contract led the curve higher in a unstable trading session. Lower LNG send-outs, high gas burn in the power sector and maintenance work in Norway are pressuring the gas system, which is 18 mcm short this morning. The Price for the front winter contracts is approaching the lows of April at 51 p/th, which should offer some battle to the surge in prices. Today, we see another strong start into the day with Aug-19 trading at 32.50 p/th (+0.6),
Wednesday 10th July 2019 - Prices increased again today due to the nervousness among traders, the slump of the GBP/EUR cross rate and by stop-loss orders that were triggered. We expect the volatility to stay high for the rest of the week.
Thursday 11th July 2019 - This morning the gas market opened with a gap up and is trading 1-2 p/th above the settlement prices of yesterday evening. Prices for longer-dated contracts have broken out of a downward trend that was active since October last year. The sentiment is shifting and there is a lot of nervousness in the market, which is evident by the high volatility.
Monday 15th July 2019 - Gas prices increased on Friday, outperforming moves in the broader energy complex which saw more modest gains in oil, power and carbon, coal closed out the day lower. This morning, the system is marginally short, flows from Norway decreased sharply on planned maintenance, storage levels are strong and Russian flows and LNG send-outs are stable. Prices began to rally 3 days ago that continues this morning, however it looks as though the biggest daily moves are behind and the market will try to consolidate at these levels before it can push higher, fundamentals do not appear to be the main driver with sentiment and fear pushing the moves.
Tuesday 16th July 2019 - Gas prices united early into yesterday's session on the back of a tight supply demand balance in the UK, increases in coal, power and carbon, coupled with concerns over the upcoming maintenance on the Nordstream pipeline. This morning, the system is slightly long, oil and coal are dealing lower as is gas as the market corrects from the recent upward moves. Storages across Europe are at almost 80% full, with Germany already 85% full providing much more security of supply going into the winter season.
Wednesday 17th July 2019 - Gas prices continued their descent from madness yesterday falling over 10% on the Day-Ahead, while losses rippled down the curve. This morning, gas prices are mostly flat in early trade action as the market looks to reassess value in this maintenance period, coal is down slightly while oil is marginally higher.
Thursday 18th July 2019 - Gas prices continued to soften yesterday on the spot and the balance of month contracts, while longer dated contracts fell and rebounded closing the day flat to the previous close. This morning, the system is slightly shorter than yesterday, albeit only marginally, Norwegian flows have improved with some productive assets returning from unplanned maintenances. Weather forecasts for next week predict some extreme heat in western Europe which could compromise some power generation from renewables and nuclear adding demand for gas-fired generation.
Friday 19th July 2019 - Gas prices dropped on Thursday, led by the spot market, longer dated contracts like Win-19 were only marginally changed. The energy complex was also bearish, oil, power and carbon all closed lower while coal remained the same. This morning, the system is balanced despite a sharp drop in Norwegian flows to the UK. The ongoing maintenance on the Nordstream pipeline has been somewhat offset by increased flows on the Brotherhood pipeline via Ukraine. The market looks set for a rebound in early trade action on the back of reports the US shot down an Iranian drone in the Persian Gulf, oil is up, coal is up, and gas is bid at the closing price from yesterday.
Monday 22nd July 2019 - Gas prices had an uncertain rebound on Friday, closing higher on the session following the broader energy market where coal prices jumped over $2/tonne, oil and power gained and carbon moved over 1 euro. This morning, the system has swung into oversupplied territory as demand has dropped sharply while flows remained constant. Temperatures are expected to rise during the week peaking towards the weekend, on the continent averages are expected to hit as high as 42'C in Paris and and the mid 30's in both London and Berlin.
Tuesday 23rd July 2019 - Gas prices rallied in the UK yesterday all over most of the session following an uptick in oil, coal and carbon, however, the rally ran out of seam later in the session and the European gas markets reversed course dropping to flat before sinking into deficit. This morning, the market is again over supplied in the UK, flows on the continent are low and storage injections have been put on hold. Gas prices are dealing slightly lower, coal is offered on at the closing price, while power and carbon are slightly lower in early action.
Wednesday 24th July 2019 - Gas prices were dropping sharply early in the session yesterday before rocketing upwards and finally sinking back into the close, leaving prices in the higher day on day. This morning, the system is balanced, gas is trading flat to the close in thin early volume. Coal prise are unchanged, oil is up modestly while carbon is unchanged. Power prices are up slightly, particularity on the continent where a few power plants have been side lined due to the ongoing heat.
Thursday 25th July 2019 - Gas prices dropped yesterday, calming the efforts made by the bulls the day before, restoring the downward trend that began after the rally that was kicked off with the start of Nordstream maintenance. The broader markets sold down with gas, coal and oil were dealt lower, along with power and carbon credits. This morning, the system is long with flows from Norway, Russian and LNG mostly unaffected day-on-day. markets are mixed today with some gains and losses spread across fuels and contracts, oil is up, coal is flat, power is mixed, and carbon is sideways, gas prices are decreased slightly for August delivery while the rest of the contracts have yet to trade.
Friday 26th July 2019 - Gas prices were mostly unchanged yesterday with minor gains and losses marked across the curve, coal and oil closed slightly higher while power and carbon closed slightly down. Today also marks the peak of the heatwave with temperatures to moderate over the weekend and next week, however conditions will remain the same for the 15-day outlook. Gas contracts are trading around the close with no clear direction in early action, oil is up modestly, carbon is slightly down, and coal is trading at the close.
Monday 29th July 2019 - Gas prices dropped late in to the close of Friday's trading session, weighed down by falling coal, European power markets and carbon. Over the weekend, maintenance on the Nordstream pipeline came to an early end as flows began to ramp up to pre-maintenance levels and temperatures began to cool after the most recent European heat-wave. This morning, the system is stable, Flows from Russian and Norway are ramping up and temperatures are returning closer to seasonal normal. Gas prices are somewhat lower in early trade action, downside resistance is sneaking into the front month which is at a steep discount to the front season as storages are expected to resume injections.
Tuesday 30th July 2019 - Gas traded lower yesterday in both the UK and on the continent on the back of falling coal prices, increasing Russian supplies and falling weather related demand. Losses on the continent outstripped those in the UK due to a falling pound against a more resilient euro, the result of some BREXIT related headlines that sent the pound into a tailspin. This morning, the system is long, flows from Russia continue to ramp up and are joined by minor increases from Norway. Power generation from wind is expected to pick up in both the UK and Germany today easing demand for gas. In early trading prices are unchanged.
Wednesday 31st July 2019 - Gas prices were range bound during trading yesterday, a sell-off during the first half of the day was reversed in the afternoon. The August contract expired for trading on the exchanges leaving only the OTC markets before full expiry today, strength can be accredited to closing positions. The wider energy markets were soft with power and carbon dealing lower, coal was sideways while oil rallied one dollar on expectations of a week-on-week storage draw in the US and tighter supplies. This morning, the system is long, demand is waning, supply is balanced, and the weather is normalising. Markets are sideways in early trade action.
Market Comments August
Thursday 1st August 2019 - A minor rebound in gas prices yesterday came on the heels of the August contract expiry and the start of Norwegian maintenance which will disrupt production and flows during the month. The gains continued from the open until near the close when prices retraced, closing in positive territory. The US FED cut rates 25 basis points yesterday to support a slowing economy, boosting the dollar. This morning, the system is balanced, flows from Norway are down while receipts from Russia have improved. Oil, gas and power are all trending up while coal is mostly sideways, low wind production on the continent is supporting near term gas prices for power generation.
Friday 2nd August 2019 - Gas rallied yesterday, moving up with coal, power and carbon after rebounding off a technical resistance. The market in Europe was bullish, despite a trouncing taken in the oil market where crude decreased more than $4, more tariffs from the US against China and the fear of a global economic slowdown were behind the moves. This morning, the system is long 25mcm, temperatures remain moderate and storages have begun to inject again, the UK is now 92% full. The list of LNG vessels heading for NW Europe has begun to increase again as maintenances around the world end.
Monday 5th August 2019 - Gas prices fluctuated on Friday before closing at the end of the session, coal and carbon also closed lower taking power down with them. U.S. President Trump’s threat of a 10% tariff on $300bn of additional Chinese goods would come into force on 1 September, meaning that almost all Chinese imports would be subject to tariffs. This morning, the system is long 23mcm, Russian and Norwegian flows have returned to normal levels, wind output is up slightly, and temperatures are moderating to seasonal levels. Storage levels continue to climb into the end of the summer season, both German and Dutch stocks have surpassed 85%, gas is trading around the close in early action.
Tuesday 6th August 2019 - Gas markets traded down yesterday, driven by weakness in the spot market from an oversupplied system as LNG imports are set to rise. Pressure from the front of the curve rippled through to the longer dated contracts and was met by bearishness in the coal, oil and power markets. This morning, the system is marginally long, coal, power and carbon are all dealing lower along with the gas markets in both the UK and on the continent. Storages in German have resumed injections since the Russians took their annual maintenance and volumes are edging closer to 90% full.
Wednesday 7th August 2019 - Gas drops for a third day amid global commodity sell-off. The escalation of the trade war and growing fears of a recession sent oil and coal prices tumbling yesterday. We see increasing pressure on the longer dated contracts and the front winter trading below 50 p/th again. Maintenance work at the gas fields in Norway will support the prices at the front for the next couple of weeks. This morning the gas cut at Teesside was extended until Thursday. The short end of the curve is trading higher while the longer dated contracts are unaffected.
Thursday 8th August 2019 - Gas prices traded sideways for most of the session yesterday, ending mixed, with some gains and losses across the curve. These moves disregarded the sharp drop in oil, followed by more minor retracements in coal and carbon. This morning, the system is marginally long, UK storage is just short of 100% full leaving little flexibility to deal with oversupply save for exports. The broader markets are slightly higher with oil gaining on news the Saudis will work to support prices, carbon coal and power are marginally higher, gas is unchanged in early action.
Friday 9th August - Gas prices increased yesterday on the spot and curve, with the latter making outsized gains over the former. The commodity markets were generally strong with oil regaining value, along with coal, power and carbon. The size of the move in gas has been driven by the perpetually short/bearish nature of the market and impending maintenance that will cut flows to both the UK and the continent. This morning, the system is oversupplied despite the beginning of maintenance in both the UK and Norway, combined the reduction will be over 60mcm per day of gas and it will increase into the close of the month. Gas is down on the spot and trading flat on the curve, trending with minor gains in oil, power and carbon.
Monday 12th August 2019 - Gas markets closed the week out basically unchanged from Monday last, minor losses were felt on the continent while in the UK the market traded mostly sideways, coal power and carbon were dealt lower while oil found support near its most recent bottom. This morning, the system has gone short as demand in the UK has picked up with a drop in wind power output as generators call on more gas fired power plants. The weather outlook remains seasonal with temperatures around normal, while wind should increase later into the week. Storages in the UK have hit 102% of working capacity, while German stocks are now 90% full, Europe is 86% full, maintenance in late August/September will slow injections into facilities with waning capacity.
Tuesday 13th August 2019 - Gas prices cratered yesterday, driven down by weakness in the European energy complex despite a tight spot market, the only bright spot for the bulls. Market weakness in coal, oil, power and carbon has come on the heels of bearish economic news from around the world. Growing storage stock, improving nuclear availability and stable supplies have heaped pressure on gas prices. Today, the system is again short which should lend some support to the spot and Day-Ahead markets, however, oil, coal, power and carbon are all dealing slightly lower, making the upside fight for gas a more difficult one.
Wednesday 14th August 2019 - Gas prices gained yesterday from the spot to the far end of the curve, driven higher with the broader energy complex, outsized gains in oil and coal, coupled with higher power and carbon provided the lift. Much of the volatility came from the US government, which announced that it would delay imposing additional tariffs of 10% on some Chinese goods, driving global stock and commodities markets. This morning, the system has swung back to oversupplied on increased flows from Norway and a drop in demand. Gas prices are off marginally in early trading along with oil, coal, power and carbon.
Thursday 15th August 2019 - The system is balanced, oil is down along with Asian stock markets that have followed the US markets which tumbled yesterday. Gas markets in the UK and on the continent are trading sideways, while the broader energy complex is mixed. Negative news from Germany of economic contraction in the previous quarter, along with the trade war is casting a sombre tone over the markets.
Friday 16th August 2019 - The broader energy markets sold down yesterday, and the UK gas and power markets were not immune to these forces. UK gas dropped sharply from the front of the curve, pulling longer dated contracts down as well, increases in wind out-put and generally softer demand were the drivers. Much the same on the continent however the loss in value for the euro provided some resistance to the slide. This morning, the system is long, storages in the UK are full and wind out-put is expected to be strong further easing demand from the power sector. the broader markets may lend some support with oil and coal trading slightly higher than the close.
Monday 19th August - Gas prices stumbled on Friday, low demand and thin trading helped to drop prices in the UK while the action on the continent was a bit more mixed. The broader energy complex was only marginally changed with component contracts moving in opposing directions. Today, the system has swung into well oversupplied territory, increasing flows from both UK and Norwegian production have driven the move. Maintenance, and likely price volatility, is set to ramp up towards the end of the week as gas fields and processing plants in Norway come off line for annual maintenance.
Tuesday 20th August - Gas prices drifted marginally lower yesterday, the bearish inputs have remained the same for months, but the pressure has been building. Gas remains weak despite gains in oil which lent some support to coal and carbon. Today the system is in balance, supply and demand have increased together in response to a drop in renewables power generation.
Wednesday 21st August - A modest bounce in gas prices to close out Tuesday's trading, driven in the UK from the spot market demand for gas from the power sector on a drop in wind power production, the curve half-heartedly followed, movements on the continent were tepid. This morning, the system is marginally long, UK stocks have exceeded listed capacity as operators have crammed some extra gas into storages ahead of the heavy Norwegian maintenance starting late August to late September.
Thursday 22nd August - Gas prices were little changed after yesterday's session, trading up and closing out the day slightly higher and supported on the upcoming maintenance, gains in the UK outpaces those on the continent, pound weakness accounting for the difference. Today, the system is balanced, despite falling demand and an even greater loss of supply into the UK markets, dropping Norwegian production was slightly offset by an increase in Russian flows. .
Friday 23rd August - After tracking gains for most of the session, gas prices in the UK cratered near the close as the pound rallied, a softening of the broader energy complex added to sentiment. Weakness on the continent was muted by the fall in the euro. Today, the system has swung 20mcm long in the UK, a drop in flows from Norway has not had an impact on the balance. The market looks soft from the opening bell, carbon is down with power and coal while oil is up slightly.
Tuesday 27th August - UK gas and power markets were closed along with the FTSE for a bank holiday, Prices in this report are from Friday’s settlement for the UK. Continental markets were open on Monday but many traders in these markets are domiciled in the UK and trading was minimal. Today, the system is marginally short, Maintenances in Norway has curtailed supplies, however, storages are brimming, and LNG volumes are increasing slightly so the market has remained calm. Gas prices are down slightly in early trade action, along with coal, power and carbon, oil and equities are up slightly.
Wednesday 28th August - Gas prices fell yesterday, moving down with the broader European energy complex, coal, power and carbon, only oil had a late session move on preliminary (API) data that showed an 11million barrel drop week-on-week from US stockpiles. Today, the system is balanced despite a drop in supplies of almost 40mcm, storages have yet to be tapped to over the maintenance period as no major imbalances have occurred. In early trading oil, coal, power and carbon are up and gas is following cautiously.
Thursday 29th August - Gas markets bounced around yesterday tracking commodities in the European complex and closing the day broadly unchanged on either the continent or in the UK. Today, the UK system is balanced, demand and supply are both down with LNG send-outs unchanged. Storage volumes continue to creep higher and send-outs of LNG on the continent are increasing to make way for a minor up-tick in arrivals to European ports. Prices are unchanged in early trading along with coal, power and carbon, oil is down marginally.
Friday 30th August - Gas prices jumped yesterday as exchange trading on the front month closed, making October the new front month, September can only be traded in the bilateral markets today. Today, the system is long, oil and coal are dealing slightly lower in early action and weather forecasts have been revised a bit warmer for the second week of September. Gas is trading around the close, power and carbon are up, suggesting a bit of volatility for the final trading day of the week.
Market Comments September
Monday 2nd September 2019 - Gas prices collapse this morning. A 44 mcm long system causing a sell-off of Dayhead and Withinday by 4 and 5 p/th respectively. We are looking at supply glut that might persist throughout September and well into October. The sell-off at the prompt pulls down the prices on the curve. W-19 has traded below 45p/th for the first time this year and contracts further out on the curve are also increasingly getting under pressure.
Tuesday 3rd September 2019 - On Friday the markets bounced, but it seemed to be more driven by end-of-month buying interest and traders perceiving prices as low. Fundamentals never really changed, and yesterday the markets had to catch up with them. This meant a very bearish day across gas markets in Europe. The system was heavily oversupplied despite high Norwegian maintenance, and we see quite a few LNG ships on their way to North West Europe. Also, coal, oil and carbon were down yesterday. Today, the markets are up to a slow start but seem to open marginally to down side. Both coal and carbon are trading near previous support levels, so keep an eye out for a bounce in these, as this could lead to some buying interest in gas as well.
Wednesday 4th September 2019 - Coal bounced almost 1 $/ton and carbon managed to bounce off the €/ton level once again. Coupled with an unexpected outage in Norway, this led to some buying interest in European gas markets. Today’s morning prices are up further, as we see a further bounce in carbon. The developments in the UK around BREXIT seems to give some buying interest, and carbon is currently testing the 26 €/ton level, up ~0.7 from yesterday. Fundamentally, the gas markets are still well supplied, and the unexpected outage in Norway has already ended.
Thursday 5th September 2019 - Gas prices remained soft yesterday, spot prices struggled to rebound from 10-year lows and the curve ticked lower. Weakness abounded despite a massive rebound in oil prices and minor gains in power and carbon. This morning, the system is balanced, which is bearish in the face of a massive outage in Norway.
Friday 6th September 2019 - Gas prices closed higher on Thursday, making marginal gains in line with the broader energy complex which saw both coal and oil close higher day-on-day. Today, the system is balanced, weather forecasts remain mild with temperatures at or around seasonal normal for the 15-day outlook, flows from Norway are improving as some of the maintenance has been complete, LNG send-outs and UK gas exports to the continent are al so up. Gas is trading mostly flat to the close this morning, oil and coal are up with stocks, power and carbon have also made minor gains in early trade action.
Monday 9th September 2019 - Gas prices closed higher on Friday, moving up with coal and oil. Today, the system has swung into a sharp deficit, driven by a drop in flows from Norway to the UK coupled with an up-tick in weather related demand and a drop in wind output. The shortfall should be easily covered with outflows from LNG and the surplus in medium range storages. Gas prices are following oil and coal this morning, along with the broader European energy complex, power and carbon retain value in early trade action.
Tuesday 10th September 2019 - Trade action on gas was mixed yesterday, a short system lifted spot prices in both the UK and on the continent supporting the curve for most of the day. Later in the session, as the system rebalanced prices dropped at the front end of the curve, while the strong coal and oil helped to keep the back end up. Today, the system has swung back to oversupplied, oil is up marginally, but the rest of the complex, coal, power and carbon are down, while weather forecasts show more wind and mild temperatures for the 15-day outlook, resulting in a softer start to gas prices in early trade action.
Wednesday 11th September 2019 - Gas prices exploded higher yesterday, on the back of headline driven covering of short positions and speculative length. To recap, French nuclear facilities may have problematic components and fears of widespread outages hit the market, Dutch gas production from the Groningen field will be reduced more aggressively and closed earlier than previously announced and finally Gazprom lost its 3rd party exemption which could lead to cuts in transit capacity into Europe for its Nordstream pipeline. Today, the system is long, flows have increased slightly from both Norway and Russia, gas and power prices are up along with coal and oil as the market works through all of the news and chaos from yesterday.
Thursday 12th September 2019 - Gas prices went on a roller coaster ride yesterday, rising, falling and rising again before settling into the close mostly unchanged. Gas flows remain undisturbed even after the court ruling against Gazprom, on the Nordstream route, LNG send-outs may pick up further with 6 vessels expected to the UK during the remainder of the month, finally Norwegian gas production continues to return from maintenance. Today, the system is long, forecasts remain mild and export to the continent have ramped up to export excess volumes. the market is trading around the close in early action.
Friday 13th September 2019 - Gas prices went in divergent directions yesterday, with the spot and front month moving up while the Nov-19 and forward prices came down. The result was some modest support for the Win-19 contract while Sum-20 and forward were dealt lower, a signal that the current bullishness is to be more focused on the winter period. Today, the system is balanced, UK production is down slightly while demand remains unchanged, Norwegian flows continue to improve while Russian and LNG output are unmoved. In early action gas prices are trading tight to the previous close along with minor gains in carbon, power and coal, oil is being dealt lower.
Monday 16th September 2019 - Gas prices closed lower on Friday, save for the spot and the very front of the curve, the broader energy market was soft or sideways with oil down, coal up slightly and carbon flat. Over the weekend, drone attacks on Saudi oil infrastructure brought geopolitical risks back into the oil markets. The attacks disrupted 58% of oil production and 18% of natural gas production. Half of the lost production should be back up today or tomorrow while the remainder is expected to be online in a few weeks. Understandably, energy markets are up with NBP and TTF Oct-19 trading 1.3p and 60 cents higher. Gazprom has refused to drop deliveries on the OPEL (German gas point) until it receives formal notice and flows remain intact ahead of trilateral talks on Russia/Ukraine gas transit this week, German storages hit 97% full.
Tuesday 17th September 2019 - Gas prices rallied yesterday, driven higher on the back of an oil rally, the result of an attack on Saudi Arabia which cut that nation's production in has and removed 5% of global volumes. Strength in gas was also bolstered by rising coal, and the virtuous cycle of gaining power and carbon in the European energy complex. Today, the news from the oil market is a bit less optimistic, the timeline for repairs to infrastructure has been pushed forward from days, to weeks and months. Closer to home, Ukraine has bought 450mcm of gas for Q1-20 which should reduce concerns over flows, as negotiations kick off later this week. Storages continue to climb, and Russian flows are increasing with more volumes going via Ukraine as the German route contracts, prices are slightly lower in early action.
Wednesday 18th September 2019 - Gas markets were sent into a tailspin yesterday after Saudi Aramco revised the length of its oil production outage from weeks/months to full production by the end of September, oil shed over $4 in value in minutes, gas prices lost between 5%-10% of value from the previous close. The broader energy complex also came under pressure with coal, power and carbon collapsing. This morning, the French nuclear sector and EDF are in the news, the company says only 6 reactors are affected and EDF believes they will not need to be taken down for unscheduled maintenance. The markets have tumbled further in early trade action, as falling power and carbon prices sour the once bullish mood.
Thursday 19th September 2019 - Gas prices were dealt lower yesterday, along with the broader energy complex and an expected increase in arrivals of LNG. The greatest weakness was at the front of the curve, the October 2019 contract, which will be under pressure from returning Norwegian flows, greater LNG and diminished storage flexibility. Today, the system is slightly short, flows from both Russia and Norway have ticked slightly higher, while LNG send-out are slightly lower. Across the energy complex, coal and continental power are up, carbon is down, and oil is sideways, gas is trading close to the close from yesterday without any direction yet. Russia/Ukraine/EU gas transit talks begin today.
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