Gas prices edge up amid geopolitical tensions
Gas prices edged higher on Tuesday as geopolitical tensions and low wind generation came into focus.
Modest gains of circa 0.06p/kWh were posted across the near-curve, with the Israel-Gaza conflict once again serving as a key source of concern.
Global markets are following current events in the Middle East region carefully, it’s unclear if a proposed ceasefire can be agreed between the Israel Defence Forces (IDF) and Hamas after Israel warned civilians to evacuate ahead of an assault on the city of Rafah. It’s unclear at this time if the assault can be avoided through peaceful means but the risk of a wider conflict certainly has markets on edge.
Further support likely emerged from dwindling wind output, data from National Grid shows that wind turbine output fell by more than 72% when compared to Fridays gas-day which subsequently bolstered gas-fired power demand across the same period.
Natural gas prices have opened very much in line this morning, with the Winter 24 front-season contract currently being offered 0.02p/kWh below its previous settlement, at time of writing.
The UK is currently consuming 31.89 GW’s of electricity (09:30 – 10:00).
As highlighted above, the UK’s onshore and offshore wind turbines are only currently generating 2.08 GW’s (6.13%) of the UK’s total electricity with gas for power having to generate 12.05 GW’s (35.50%) of the total.
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