Energy Market Report – Gas

  • 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.

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