Further drops at the NBP as unplanned pipeline outages conclude

The NBP started the week on a bearish note, with key contracts such as December 26 and Summer 27 extending Friday’s reductions.

Norwegian flow nominations into the Easington and St Fergus terminals reached their highest level since 17th January, totalling 103mcm across Monday’s gas day, as the conclusion of several unplanned outages over the past few days boosted exports from Europe’s largest gas supplier.

While the recovery in North Sea supply improved the near-term outlook, strong gas demand from the power sector likely limited downside.

Data from National Gas shows that, as at 4pm yesterday, gas-fired power plants were drawing circa 98mcm/d from the NTS, with very low wind generation diverting gas towards supporting a strained power system.

Baseload power also extended Friday’s losses on Monday, with Summer 27 settling £2.83/MWh (2.3%) lower at circa £120.2/MWh and December 26 down £6.52/MWh, according to ICE data.

This came despite a tight morning for the grid, with NESO issuing an Electricity Margin Notice for 6–11am. Wind slid from 9.4% of the stack to 3.8%, while gas-fired generation climbed to 64.2%.

Plants reserved for peak demand or shortfalls were called upon, with expensive open-cycle gas turbines running for 17 hours and, with pumped storage and hydro, supplying over 3 GW at the evening peak.

The Crown Gas and Power 14-day model points to subdued wind through a sharp cold snap this week, before a marked recovery from early next week.

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Price commentary courtesy of Crown Gas and Power