Gas prices soften as LNG shipments arrive at UK shores

Day ahead gas prices softened on Thursday amid a positive LNG outlook and a weakening wider energy complex.

Prices across the near-curve posted the biggest losses with the April-24 contract falling 0.12p/kWh when compared to its previous close.

Plentiful LNG supply likely acted as a prime source of good news; the latest shipping signals indicate that 5 laden vessels are scheduled to arrive on British shores by the 2nd December

Data from the Port of Milford Haven shows the LNG Abalamabie is due to unload American volumes at the South Hook No1 terminal today.

A slump in oil and carbon prices also helped. ICE data shows the Brent Crude benchmark contract posted its largest loss in a single session since the 4th October, shedding almost $4/barrel day-on-day and closed to its lowest level in more than 4 months.

However, a drop in wind generation likely limited the losses. According to data from National Gas, solar and wind generated power slumped on Thursday, subsequently bolstering CCGT (combined-cycle gas turbine) output which increased by a considerable 55% when compared to the previous day.

In other news, the Belgium-Britain interconnector operator began scheduled maintenance of the bi-directional pipeline yesterday, reducing flow capacity to zero during the 10-day period.

This morning, day ahead gas prices have opened in negative territory with the Summer-24 contract last trading at circa 0.03p/kWh below its previous close.

If we check the latest half hourly period at the time of writing (13:30 – 14.00), 55.74% (21.26 GW’s) of the UK’s total electricity (35.94 GW’s) is being generated from gas at the moment. Wind turbines are only contributing to contributing 2.15 GW’s (2.71%) of the total generation mix.

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