Gas prices pulled down as weather forecast improves
Day ahead gas prices were pulled down on Monday amid milder revisions to weather forecasts and ample Norwegian supply.
Contracts seemingly retraced the bullish moves of the previous two sessions; prompt and near-curve contracts saw the biggest losses with the November 23 front-month contract falling a massive 0.65p/kWh when compared to its previous close.
The swift change in sentiment was likely attributed to forecasts of milder than expected temperatures over the next two weeks. According to our latest forecast model, temperatures are now set to rise above seasonal norms from 18th October which could help to curb heating-related demand in the short-term.
Strong Norwegian imports likely played into the bearish sentiment. According to data from offshore operator Gassco, pipeline flows into Great Britain stood at 63.1mcm/day on Monday which was up from just 28.2mcm/day across Friday’s gas day when prolonged summertime maintenance was still winding down.
On the LNG front, the latest shipping signals show that 3 laden vessels are set to berth at British terminals over the next three weeks, despite upcoming strike action in Australia. Data from the Port of Milford Haven shows that the Minerva Amorgos will offload US volumes at Dragon No.1 terminal tomorrow morning.
In other news, workers union Offshore Alliance said that 91% of its workers have voted to restart strike action at the Gorgon and Wheatstone LNG facilities in Western Australia, with industrial action set to begin on Thursday 19th October if a deal cannot be reached in the meantime.
As prices remain extremely volatile, it’s really important to keep a track on the latest wholesale market trends. We produce a market update every Monday morning. Click here to see all previous editions.
If your electricity or gas contract is up for renewal in the next 6 months, we would encourage you to compare prices now as the market remains extremely volatile.
Compare prices online for your meter by clicking here or contact your Energy Advice Line account manager now for the latest information.