Daily Energy Market Report Thursday 12th April 2018
NBP contracts continued to rally on Wednesday finding support from tight system dynamics and higher prices in both oil and coal.
Continued Norwegian planned maintenance and strong demand supported prompt contracts whilst stronger oil prices due to geopolitical tensions led to sharp increases on the curve.
Today, the NBP opened slightly lower despite a short system and continued strength in oil.
There has been capacity come back online after some outages in Europe ended yesterday.
The system was around 6.9mcm short earlier this morning but has since come into balance.
LDZ demand has out turned higher with slightly cooler temperatures at the back end of this week.
However, this weekend the UK will turn warmer with temperature reaching around 20 degrees later next week.
IUK has flipped to importing today with nominations of 6mcm.
UKCS nominations continue to be strong with high St. Fergus flows.
LNG send out is relatively unchanged at 23mcm.
Escalating geopolitical risks in the Middle East are leading to increases in oil prices, with speculation over supply disruptions in the energy rich region countering concerns over rising US crude stockpiles. There are strong concerns of a military escalation in Syria after a chemical attack in the region that could threaten supply.
There is also the ongoing trade dispute between the US and China which is one of the reason behind the volatility we have seen in oil of late.