Last Friday, NBP (National Balancing Point) contracts remained steady, trading within a narrow range due to the market stagnating. The curve saw minor movements, and most near-curve contracts shifting by a maximum of 0.2p/therm (0.007p/kWh).
What does this mean?
The low market prices have been a reflection of the ongoing weak gas demand. National Gas data revealed that on Friday, demand totalled 171 million cubic meters (mcm), marking a 4% decrease from the previous gas day. Crown Gas and Power predict that UK gas demand will continue to decline below seasonal average until at least 2nd June. This aligns with the unusually mild weather forecast going into June.
This week, European gas hubs will be hit with a reduced supply from Norway. New maintenance due to take place this week will see offline capacity peak at 176.91 mcm/day this Tuesday, then decreasing to 54.60 mcm/day by Friday 24th.
Summary:
Despite these issues, natural gas prices opened on a brighter note at the start of the week. The Winter 24 front-season contracts trading around 2p/therm (0.07p/kWh) below its previous close, as of this Monday. This is because the market is continuing to level out after experiencing decreased demand over the last couple of weeks.
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