Energy Market Update - 11 July 2024

Energy markets saw a mixed session with a decline in gas prices and stable power prices. Brent oil and carbon markets remained steady.

UK and European natural gas prices continued to drop, with the NBP DA falling nearly 2% due to healthy supply and weak demand. Norwegian gas flows remained steady at 333.7 mcm/day. European gas storage is approaching 80% capacity, indicating robust supply. Despite maintenance at Visund and Troll, Norwegian exports total 331 mcm/day. The UK system opened 4 mcm/day long, with no new LNG cargoes scheduled. Wind speeds are forecasted to decline, potentially impacting supply.

Power prices in the UK were mixed; spot prices rose while curve prices followed fuel sentiment downward. UK power prices for DA settled at £73/MWh, with the front month contract at £64/MWh. The stability in power prices is supported by ongoing healthy gas flows and strong wind generation expected to resume soon.

Brent oil prices held steady at $85.08/bbl. Market sentiment was influenced by a drawdown in US inventories and delays in Freeport LNG production due to outages in Texas, adding bullish pressure. European carbon prices also saw stability, with EUA Dec 24 settling at €67.96/tonne, reflecting the balanced market conditions.

Overall, energy markets reflect a cautious optimism with ample gas supplies, stable power prices, and steady oil and carbon markets. The market remains attentive to weather forecasts and infrastructure developments that could influence future price movements.