Daily Energy Market Report Thursday 8th Nov 18. Prices have risen today off the back of an increased risk of colder weather in late November, as well as strength in wider commodities, with oil, carbon and coal all rising overnight.
The UK system is 6.1mcm long this morning at time of writing with demand at 224.3mcm, 10.3mcm below seasonal normal.
LDZ demand is at 157.9mcm, an 11.1mcm increase day on day.
Gas for power demand has moved lower by 5mcm to 50mcm.
LNG send has also moved lower but remains healthy at 23.5mcm with a cargo expected to berth at Dragon today.
UKCS is flowing at 80.1mcm and Langeled is nominating at 63mcm with the outage at Kollsnes being revised down from 30mcm to -15mcm WD.
Temperatures remain above seasonal normal with milder weather expected to last until mid-week 47.
However, there is a risk of colder weather now for late November early December with a colder 45 day forecast likely off the back of latest models showing pressure building across Northern parts of the Continent.
The prompt and near curve has lifted as a result.
Oil has risen overnight off the back of further weakness in USD as the US mid-term election fallout continues.
Daily Energy Market Report Thursday 8th Nov 18
Also, yesterday Brent rose to $73/bbl on reports that Russia and Saudi Arabia are discussing oil output cuts in 2019.
However, the bears still look to be in control with US production continuing to increase, heightening fears surrounding a global oversupply.
Both coal and carbon have strengthened overnight in line with related energy markets with the risk of colder weather towards the end of November.
API2 2019 coal contract is at $92.20/tonne with the benchmark Dec-18 EUA carbon contract at €19.38/tonne at time of writing.
However, market fundamentals still look to be bearish with coal inventories at European terminals at record highs.
On FX, the dollar moved lower against other currencies yesterday as the Republicans lost control of the House of Representatives in the mid-term elections.
However, we have seen some strength this morning prior to the monetary policy announcement from the Federal Reserve later on this evening where the Fed could view the US economic outlook favourably.
GBP has also strengthened today on the back of renewed Brexit optimism; Theresa May has said the deal to withdraw from the EU is 95% complete, however there is still no agreement on the border in Northern Ireland.
Daily Energy Market Report Thursday 8th Nov 18 brought to you by British Utilities