We started the week with another volatile trading session at the NBP yesterday.
- Front-end Gas contracts opened 2% lower before ending the day 4% positive.
- The market is still looking for direction with short-term weather forecasts and Norwegian pipeline supply in focus.
- On the power side, weather models show potential windier conditions towards the end of the week with some negative pricing risks.
- Further out and with a view to winter ahead and 2025, EU meetings continue to resolve issues around the residual Russian gas supply volumes transiting Ukraine. This amount is significant at around 15 BCM. The current transit agreement expires at the end of the year. The leading proposal revolves around gas being “replaced” by injected gas from Azerbaijan. This would utilise pipeline capacity back into European markets.
- PPA and Green Markets remain broadly in line with pricing from last week’s close. However, we expect price volatility to remain, which will present both opportunity (to fix forward) and possible downside price risks.
If you have any questions, please let Fran or me know.
Jamie Banks
PPA Manager at New Stream
Update 12/6
- Gas holds gains and supports power / PPA pricing this morning.
- Headline driven again with news on Australian LNG supply that we flagged last week.
- July NBP Gas last trades – 82.25p.
- UK Baseload Power at £74.75 MWh.
If you have any questions, please email Fran or Jamie or call the desk.
