Wholesale prices remain volatile but struggle to find clear direction

Gas prices struggled to establish a clear direction at the NBP on Tuesday as strong LNG supplies seemingly outpaced lacklustre wind generation.

Key contracts continued to trade within the narrow range established over the past sessions, with elevated volatility witnessed during the late afternoon that culminated in small losses across the majority of the curve.

On the LNG front, the latest shipping signals indicate that up 8 vessels could arrive at UK terminals over the next two weeks. Hot on the heels of the 3 arrivals already recorded for this week, another 2 laden vessels are expected to offload volumes on Saturday.

A sustained increase in the number of vessels signalling for the UK has helped to offset unseasonably high demand.

According to data from National Gas, LNG send out averaged at a rate of 64mcm/d on Tuesday, up from just circa 21mcm two weeks ago.

Data from National Grid shows that wind generation declined by 67% when compared to the previous gas-day, triggering a 166% increase in gas-fired (CCGT) power demand over the same period that made up 50% of the generation mix on Tuesday.

In other news, it is being widely reported this morning that a ceasefire has been agreed between Israel and the Hezbollah group based in Lebanon, bringing more than a year of continuous conflict to a pause and helping to ease geopolitical instability in the region.

This morning, gas prices have resumed their downward trajectory, with the Summer 25 front-season contract currently being offered circa 1.5p/therm (0.05p/kWh) below its previous settlement at time of writing.

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Price commentary courtesy of Crown Gas and Power