Strong winds helps reduce wholesale gas prices

Strong winds and a weak wider energy complex meant that gas prices reduced on Friday.

Small, incremental losses of circa 1.2p/therm (0.04p/kWh) were posted across the majority of curve contracts when compared to their previous close, as prices continued to hold within the narrow range established over the past few weeks.

Elevated wind power continued to subdue gas-fired power demand on Friday, although it had dropped significantly from the day before, wind turbine output held above average at a rate of 9.5GW/day and met 33.5% of total British power demand (data from National Grid).

Weakness observed across the wider energy complex likely helped extend bearish sentiment to the far-curve; data from ICE shows that the Brent Crude (Oil) and Rotterdam Coal benchmark contracts saw day-on-day losses of 1% and 2.5% respectively.

In other news, Hurricane Beryl which caused widespread damage in parts of the Caribbean last week is set to make landfall in Texas later today. Although Beryl had dropped from a Category 5 down to a Tropical Storm by the end of last week it has since strengthened back into a Category 2 storm meaning that energy infrastructure in the region could be at more risk than initially thought.

This morning, gas prices have edged up at the NBP with the Winter 24 front-season contract currently being offered circa 1p/therm (0.034p/kWh) above its previous settlement, at time of writing.

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