History of Energy Prices Wednesday 07 Nov 18
07 November 2018 – The US mid-term elections took place with the Republicans losing control over the House of Representatives with the Democrats gaining the ability to block Trump’s agenda. The dollar lost value as a result which led to increases in oil, which in turn, lifted the NBP.
31 October 2018 – Weaker commodities in carbon and coal, along with strong supply into the UK and milder temperature forecasts have pressured both the near and the far NBP curve downwards.
16 October 2018 – European gas markets being at a premium to Asian markets fuelled an influx of LNG to European terminals and send out reached its highest level since 2012.
03 October 2018 – API2 2019 coal traded over $100/tonne off the back of increased demand as stocks replenish and supply tightness. The gains filtered into European gas hubs with the NBP lifting in line with coal.
01 October 2018 – The start of the new gas year marked the expiry of long-term capacity contracts on the IUK. The pipeline was nominating at a rate of 0.9mcm, pushing NBP, prompt prices down as the lack of export demand sent the system around 30mcm long.
02 September 2018 – The NBP collapsed, tracking a crash in Carbon EUA’s. Dec-18 EUA’s fell over 20% on the back of profit taking and the possibility of further credits being added to the market to boost supply.
29 August 2018 – Strength in GBP went against the bulls on the NBP. Barnier’s comments on Brexit drove significant gains with the Chief Negotiator stating “We are prepared to offer a partnership with Britain such as has never been with any other third country”.
24 August 2018 – Disruption set to continue in the North Sea after Unite and Total failed to come to an agreement over pay structure and working hours. Strikes are set for 17th September, 1st, 15th and 29th October.
17 August 2018 – Norwegian maintenance and continued strike action on platforms in the North Sea supported the front of the curve.
14 August 2018 – Carbon EUA futures hit 10 years highs, on the back of utility companies hedging there generation, providing support to gas markets across Europe.
08 August 2018 – Talk of a ‘no deal Brexit’ and continuing uncertainty resulted in GBP/EUR hitting lows of around 1.10, levels not seen since September 2017, encouraging European buyers of NBP gas.
07 August 2018 – The US re-imposed economic sanctions on Iran, severely hindering Iranian oil output. Brent and the NBP lifted as a result.
25 July 2018 – Strength in Coal continues to drive the NBP with increases in Asian and European demand off the back of low wind generation and warm temperatures.
16 July 2018 – Oil saw the largest intraday drop for 2 years after falling around $3.50/bbl. off the back of a potential increase in Russian production, Norwegian oil worker strikes ending and the US considering the importation of Iranian oil despite sanctions.
10 July 2018 – Strength in wider commodities bolstered the NBP. API2 Coal reached new multi-year highs of around $92.95/tonne.
28 June 2018 – The planned Interconnector maintenance ended and strong exports to Europe through the pipeline followed.
22 June 2018 – OPEC agreed a modest increase in oil production of approximately 700,000 barrels per day.
12 June 2018 – The NBP Day Ahead contract opened around 1.65p/th below the previous days close on the back of Interconnector maintenance (13th-28th June).
07 June 2018 – A letter from the Dutch economic affairs minister to Dutch parliament claimed that gas production at Groningen could be reduced to below 12bcm by October 2020, 2 years ahead of schedule.
05 June 2018 – The sell off on the NBP continued, after weeks of gains, following warmer weather, an improvement in European storage levels and weaker oil.
30 May 2018 – Oil prices fell as Russia hinted at increasing production to offset the reduced exports from Venezuela & Iran, following both countries having sanctions placed on them by the US.
22 May 2018 – Carbon EUA’s continue to climb after trading above €16.00/tonne for the first time in several years, bolstering the NBP.
15 May 2018 – The NBP is driven by movements in the wider energy markets. Bullish moves in oil, carbon, coal and power are all contributing to rises in the NBP price curve.
08 May 2018 – Oil prices lifted after President Trump withdrew the US from the Iran nuclear deal. Brent jumped to its highest level since 2014 as the withdrawal increased the risk of conflict in the Middle East and cast uncertainty over global oil supplies.
25 April 2018 – Norwegian outages continue to bolster the NBP prompt with maintenance season in full swing.
14 April 2018 – The NBP far curve is driven higher by oil prices as they hit their highest level since 2014 because of US led strikes on Syria.
09 April 2018 – 2% rally in Brent off the back off a weaker US dollar and easing concerns surrounding a trade war between the US and China lifts the NBP curve.
29 March 2018 – The Dutch Government announce that production at Groningen will be reduced to 12 bcm by October 2022.
01 March 2018 – The Beast from the East hits the UK bringing temperatures significantly below seasonal normal. As a result, NBP prompt prices rocket off the back of increased demand with the WD contract trading at its highest ever level of 350p/th.
13 February 2018 – The weather continues to drive the market with colder weather resulting in significant gains on NBP prompt.
07 February 2018 – A feed control valve at the Kinneil gas terminal led to another shut down of the Forties Pipeline System (FPS) in the North Sea. However, the shutdown was short lived on the system was fully operational the following day.
01 February 2018 – The Dutch mining regulator (SSM) cut recommended Groningen output from 21 bcm to 12 bcm to ensure the safety of the people of Groningen.
29 January 2018 – The NBP prompt continues its trend downwards off the back of a very healthy UK system because of strong supply from Europe and the UK continental shelf.
08 January 2018 – A large earthquake, of 3.4 magnitude on the Richter scale, hits Groningen. As a result, a further production cut at the gas field comes into question.
02 January 2018 – Political tensions in Iran and ongoing OPEC cuts sends Brent crude to near 3-year highs of around $68/bbl.
History of Energy Prices Wednesday 07 Nov 18
12 December 2017 – Explosion at Baumgarten gas terminal in eastern Austria restricts flows into Western Europe.
11 December 2017- Forties pipeline shutdown after a crack in the pipe worsens.
07 November 2017 – Political uncertainty in Saudi Arabia (World’s largest Crude Oil Exporter) and fears of a tightening market sent global Crude prices to the highest since Summer 2015. Brent Crude traded above $64 barrel.
28 September 2017 – French Nuclear units were ordered to temporarily shut down, as soon as possible. Causing gains on Power prices, which filtered through to Gas.
25 September 2017 – Oil prices rose to a 26-month high – caused by Turkey’s threat to cut Crude flows from Iraq’s Kurdistan region to the rest of the world.
20 September 2017 – Hurricane Maria assisted Reduction in Power burn, on expectations of high wind generation.
25 August 2017 – Oil prices rose, as the US Oil industry prepared for the arrival of Hurricane Harvey. Production facilities were expected to shut down in preparation, with expectations the closures would last if the storm caused extensive damage.
07 August 2017 – Gassco – the Norwegian gas system operator modified the end date for a planned Field facility outage, adding support to the Gas prices.
02 August 2017 – Another major outage for Kollsnes cut Gas flows by 51mcm/day, raising spot prices.
26 July 2017 – An extension to unplanned maintenance at the Kollsnes Gas field in Norway was extended out until 1st October 2017, after initial expectations of it to be back online that day.
25 July 2017 – Oil prices rose, as OPEC led meeting resulted in Saudi Arabia pledging to decrease exports from Aug-17 onwards, and several other members agreeing to boost compliance to tackle global supply glut and price flagging.
20 June 2017 – Centrica made the decision to close the UK Rough Gas storage site permanently. After numerous tests, it was decided that the facility was not safe to return to injection and storage operations.
08 June 2017 – Two Qatar LNG cargoes which were destined for South Hook were diverted.
05 June 2017 – Sharp rise in prices, as Saudi Arabia, Bahrain, Yemen and the United Arab Emirates are said to have cut diplomatic ties with Qatar following claims the country could have ties to terrorism.
02 June 2017 – Oil prices fell on the back of President Trump’s decision to withdraw from the global climate change pact. It is thought that this could potentially lead to more crude drilling in the US, increasing the current global supply glut.
15 May 2017 – An extension of output cuts was agreed by Saudi Arabia and Russia (the world’s top 2 Oil producers) to extend current cuts for another 9 months, up until March 2018 – all to try to control the global supply glut. This was all to try to control the global supply glut. Oil reacted with a sharp increase on the back of the news.
12 April 2017 – Announcements made that Rough will not restart injection operations in the 2017/18 storage year. Based on safety and failure tests and extensive discussions, CSL decided that that was the best way forward.
04 April 2017 – The severe tropical storm, Cyclone Debbie in Australia caused massive supply disruption for Coal.
02 March 2017 – Reports were released on 1st March 2017 stating that Trump was set to target certain Obama-era regulations. Including the federal coal mining ban and cuts on carbon emissions.
16 February 2017– Centrica announced that Rough (Britain’s largest natural gas storage site) would be unavailable for Gas injection until at least 1/7/17. Testing was ongoing to assess the safety and condition of the asset, which is very old yet still very important to the Gas industry.
31 January 2017 – Colder than seasonal normal weather, lower than expected renewable output and concerns over storage availability, all created supply concerns.
History of Energy Prices Wednesday 07 Nov 18 – Outlook
Potential Bearish Price Drivers ↓
- LNG arrivals with European gas prices at a premium to Asian markets.
- Warmer weather forecasts.
- Strong renewables.
- Weakness in carbon and coal.
- Strong supply into the UK.
Potential Bullish Price Drivers ↑
- Strength in oil – Weaker USD – US mid-term election results.
- Weakness in GBP – Brexit sentiment.
- Colder weather forecasts.
- Unplanned outages.
History of Energy Prices Wednesday 07 Nov 18 brought to you by British Utilities