Limited diversity in UK supply pushes wholesale prices higher

A limited diversity in British supply and below average storage levels combined to propel NBP gas prices even higher on Tuesday.

According to data from National Gas, throughout yesterday’s session, UK and Norwegian supply met just over 94% of British demand.

This is in the context of another round of planned maintenance upcoming across the Norwegian Continental Shelf (NCS).

Furthermore, UK gas storage levels are currently around 50% lower than at the same point last year, significantly reducing the buffer against any prolonged supply disruptions.

Combine this with the expectation of just 1 LNG vessel scheduled to currently arrive for the entire month of June, as demand for spot cargoes across Asian markets holds strong.

Ongoing bullish momentum on the NBP gas market, coupled with renewed strength in the EU carbon market, continued to lend support to UK baseload power prices. According to data from ICE, the benchmark EUA carbon contract rose by 2.4% on the day, providing additional upward pressure for prices further along the curve.

If you want to see more information on the wholesale market trends subscribe to our weekly report here.

Price commentary courtesy of Crown Gas and Power