Strong wind output helps reduce gas prices
A tumbling oil market and strong wind-output helped reduce gas prices at the NBP on Friday.
The most notable losses were posted at the front-end with near-curve contracts shedding circa 1p/therm (0.034p/kWh) when compared to their previous settlements.
Contracts further out followed the same sentiment although the losses were smaller, likely pressured by a plummeting oil market. According to ICE data the Brent Crude benchmark contract posted day-on-day losses of almost 2.5 $/barrel, the largest downside in a single session since the 3rd of June.
Additionally, an increase in wind-generated power perhaps provided additional support, data from National Grid shows that wind-output increased by more than 21% when compared to the previous gas day; this subsequently reduced reliance on CCGT (closed cycle gas turbine) offtake which saw a drop of circa 27% when compared to the same period.
In other news, businesses in the private and public sectors grappled with widespread IT outages on Friday which also limited the number of trades logged at the NBP as traders seemingly had issues accessing trading hubs.
This morning gas prices have continued their downward trajectory at the NBP with the Winter-24 contract last trading around 1.5p/therm (0.05p/kWh) below Fridays close, however many contracts are yet to trade at time of writing.
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Price commentary courtesy of Crown Gas and Power 