The re-emergance of macro-economic fundamentals drives prices up
Gas prices edged higher on Monday as macro-economic fundamentals re-emerged as a significant market driver.
The US-EU trade agreement, informally agreed on Sunday, may have offered support due to the perspective of some market participants that it may boost economic activity in the bloc and the wider region as a result of lower import tariffs for European goods arriving in the US, buoying demand for fossil fuels in the medium to long term.
It should be noted that both sides are currently working to finalize details and get a trade deal formally signed and the provisional elements of the agreement are subject to change over the coming days/weeks.
The baseload power curve reflected bullish sentiment seen on the NBP, as reduced renewable output drove up gas-fired generation.
Despite last week’s forecasts predicting a slight rise in renewables, wind, solar, and hydro remained subdued on Monday.
This kept CCGT generation elevated and led to an increase in electricity imports, which became the largest contributor to the UK power mix on Monday.
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Price commentary courtesy of Crown Gas and Power 