Gas prices jump amid tense US-Iran negotiations
A late afternoon rally propelled NBP gas prices higher on Thursday, with the Summer 26 front-season contract closing at the one of the highest levels so far this year.
Tense US-Iran negotiations and falling Norwegian flows served as the primary source of support for the near-curve.
According to data from offshore operator Gassco, imports via the major Norway-UK Langeled interconnector fell 15.6% to just 48.1GW, though a slight increase in UK production helped to mitigate the decline in North Sea supply.
On the LNG front, fundamentals look strong heading into March, with 5 vessels signalling for arrival at British terminals next week.
February is also expected to see a total of 29 arrivals in February, up from 25 last year.
The power market saw a similar upward correction towards the end of the day, despite strong renewable output.
Movement at the front-end of the curve was likely driven by psychological factors, as uncertainty surrounding the US-Iran nuclear deal, currently under negotiation, continued to reinforce risk premiums across the wider energy complex due to the possible implications for Middle East fossil fuel exports.
Combined renewable generation met around 62.6% of system demand on Thursday, this, along with an increase in imports, heavily subdued gas-fired power demand, which contributed just 9.6% over the same period.
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Price commentary courtesy of Crown Gas and Power 