Energy Market Update – 30 April 2015

30 April 2015

Gas

Prompt contracts opened slightly above yesterday’s close. Below seasonal norm temperatures alongside high exports to Belgium has increased demand for this time of year, which has caused tightness in supply. Despite this markets have since remained relatively flat. Along the near curve contracts have seen some small losses despite the somewhat bullish sentiment on the prompt market. This downward motion is being driven by scheduled LNG arrivals as well as the Pound strengthening against the Euro. A bearish crude oil market has similarly pushed further contracts down. The national grid revised gas demand to be higher for the rest of the week, as temperatures are set to continue to stay below seasonal norm.

Day Ahead is currently offered at 44.90p / therm, a gain of 0.15p / therm from its previous settlement, with Winter ’15 offered at 48.85p / therm (0.06p / therm below previous settlement), and Summer ’16 is offered at 44.25p / therm (0.11p / therm above previous settlement).

Power

Wind generation is expected to weaken later this week, which alongside below seasonal norm temperatures has increased the Day-Ahead contract. The near curve has traded sideways this morning, despite the bearish sentiment from gas contracts. Far curve contracts have traded relatively flat due to stable carbon prices as well as gains on coal being offset by losses on crude oil.

Day Ahead is currently offered at £44.00 / MWh, a gain of £1.45 / MWh from its previous settlement, with Q3 2015 offered at £41.45 / MWh (a fall of £0.10 / MWh), Winter ’15 offered at £45.95 / MWh (a fall of £0.02 / MWh), and Summer ’16 offered at £42.88 / MWh (a loss of £0.05 / MWh from previous settlement).

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