Wholesale gas prices continue to fall
Gas prices continued to shed value on Tuesday as market fears surrounding Hurricane Beryl receded.
Substantial losses were posted across the majority of contracts, with the Winter 24 front-season contract tumbling 2.4p/therm (0.082p/kWh) to its lowest settlement since May 16th of this year.
The landfall of (Category 1) Hurricane Beryl on the Texas coast resulted in widespread damage and power outages but the damage to oil and gas infrastructure so far appears to be limited. This possibly removed an element of risk premium out of the market yesterday, with Beryl now downgraded to a ‘Post-Tropical Cyclone’ and most Europe-facing export facilities now ramping back up toward normal levels.
A strong uptick in wind power once again helped to curb gas demand, despite unseasonably high domestic demand. Data from National Grid shows that wind turbine generation surged from 1.9GW to 9.7GW (33% of the generation stack) across Tuesdays gas-day, thus suppressing gas-for-power (CCGT) demand and aligning with a 5% drop in total GB gas demand.
This morning, most contracts are being offered at a slight premium when compared to their previous settlement, although many have yet to trade at time of writing.
If you want to see more information on the wholesale market trends subscribe to our weekly report here.