LNG glut and high renewable generation helps reduce prices
Gas prices reduced into the weekly close on Friday amid the ongoing LNG glut driven by firm exports from the US and reduced regasification capacity in continental Europe.
The Nantes Knutsen arrived at Milford Haven on Saturday as scheduled and the latest shipping signals indicate that as many as 10 vessels could arrive by 16th November, reinforcing the bearish near-term supply outlook.
Furthermore, the latest run of our 14-day model suggests that system demand will fall below seasonal norms from Friday 31st October, trending below average until at least 9th November.
High wind speeds over the course of last week, especially moving into the weekend may have helped ease the pressure.
UK prompt prices have turned negative over the last few overnight settlement periods as excess renewable generation contributes to a slight surplus in supply.
Data collated from Elexon shows that wind output average 3.7 times higher across week 43 (Monday-Friday) when compared to the previous period, supressing demand for more expensive gas-fired generation.
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Price commentary courtesy of Crown Gas and Power 