2nd October 2023 Energy Price Alert – UK Gas & UK Electricity

Prices were mixed on Friday with noticeable drops in the near term through to the end of March, and modest increases after that except for W26 electricity which was pushed up back over £100/MWh 

Our strategy of contracting for 1 year maximum continues to be credible

Gas: NBP contracts were pressured by forecasts of mild weather for the time of year. Wind is forecast around 10-20% above seasonal average adding further downside. 6 LNG cargo are expected to berth in the UK prior to 22nd October. This morning prices have opened down on last weeks close.

Power: Power contracts mainly tracked the bearish movement within NBP during Friday’s session. There was some bullish movement on the far curve due to Carbon markets, but this was limited. Throughout September the UK remained a net importer of Power, the opposite of the same period in 2022, where the UK were net exporters. For price outlook, as of last Fridays close, please see the below table.

Crude: Oil prices finished last week lower. Focus this week will be on hope of China’s “Golden Week” holiday boosting demand. Elsewhere eyes will be on dwindling US inventories.

Carbon (EU ETS): The ICE Dec-23 closed at €81.67/t on Friday. The market opened this morning at €81.43/t and is trading at €81.36/t at the time of writing. 

Carbon (UKAs): The ICE Dec-23 closed at £39.20/t last Friday. The contract is currently trading at 38.50/t at the time of writing. 

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