Bullish demand outlook drives up wholesale prices
A bullish short term demand outlook buoyed NBP gas prices on Monday.
The latest run of our 14-day model shows that demand is set to outturn well above seasonal norms until at least 28th November as freezing arctic winds begin to envelope much of North, West and Central Europe.
This could accelerate the rate of storage injections from large facilities in the continent, which have so far seen slow withdrawal rates amid a prolonged period of unseasonably mild weather.
On the LNG front, the Energy Pacific arrived at Milford Haven on Monday, laden with the 100th cargo from the US in the past 12 months.
The startup of new US export projects along the West Coast has been a huge driver of unprecedented growth in the LNG sector this year.
Declining wind output alongside NBP strength supported baseload power prices on Monday.
According to data from Elexon, wind generation averaged at 12.2GW (33.6% of the power mix) yesterday, marking a sharp decline from 19.6GW (53.4%) on Friday that bolstered gas-fired power demand, which nearly doubled over the same period (5.9GW to 11.7GW).
Wind is forecast to fall further moving into the week and should keep fossil fuel generation elevated at a time when gas demand is also heightened due to below-average temperatures.
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Price commentary courtesy of Crown Gas and Power 