Wholesale prices change course helped by an oversupplied system
Gas prices changed course on Monday as system oversupply along with a broader market sell-off helped to unwind some of the gains accrued over the past few sessions.
Bearish sentiment appeared to be most pronounced at the front-end, with the Day-ahead contract posting considerable losses of circa 4.75p/therm (0.16p/kWh) when compared to its previous settlement.
A sudden 13% uptick in UK and Norwegian flows helped to send the British System (NTS) up to 35.3mcm oversupplied and prompted a more than 80% increase in storage injections when compared to the previous session (data from National Gas).
A massive downturn in global markets on Monday, driven in part by fears of a US recession, may have weighed on gas prices by sparking concern over a global economic slowdown that could supress demand for fuels across the wider energy complex.
Natural gas prices are relatively unchanged this morning, with the Winter 24 front-season contract currently being offered just circa 0.5p/therm (0.017p/kWh) above its previous settlement at time of writing.
If you want to see more information on the wholesale market trends subscribe to our weekly report here.
Price commentary courtesy of Crown Gas and Power 