Prices weaken pressured by a steady stream of LNG cargoes
NBP prices weakened on Monday, pressured by a steady stream of LNG cargoes and strong Norwegian output.
The Summer 26 front-season contract fell by nearly 5%, hitting a three-week low as weak US spot prices boosted exports and cut LNG import costs.
Henry Hub near-term contracts have also dropped sharply in recent sessions, driven by high storage and milder conditions versus Europe.
The UK has already seen 6 LNG arrivals this year and sendout was near 130mcm in yesterday’s session, making it the largest source of supply.
A further 7 are expected by 20th January, offsetting forecasts of above average demand across the same period. Recent events in Venezuela have so far had a negligible effect on crude oil prices.
Significant losses on the NBP filtered into the baseload power curve.
Falling renewable generation did reinforce the prompt however, with wind output falling to 12GW, a sharp decline of 35.1% when compared to Friday’s session.
Imports from mainland Europe fell to near-zero as a regional cold snap tightens capacity. A downward correction on the carbon market likely served to pressure contracts further out, with the Carbon EUA benchmark contract falling by circa 1.2% day-on-day, easing off from near several-year highs.
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Price commentary courtesy of Crown Gas and Power 