Weekly Price Update Report - Week 15
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Energy Market ReportsWeekly Price Update Report - Week 15

Weekly Price Update Report - Week 15

Kiran Jutti

by Kiran Jutti 10 April 2017

Report Summary:

Rising oil prices have little effect


NBP Natural Gas & GB Power Market Movement

Gas prices rose on Monday with higher gas exports to the continent contributing along with an expected increase in demand and a rising oil price.  An unplanned outage on Tuesday and continued high offtake of UK gas from the continent meant that prices continued to rise on the second working day.  The upward trajectory in prices failed to halt mid-week with the gas grid once again undersupplied.  Price did ease back during the course of the afternoon but still closed higher slightly on the day itself.  A stronger LNG outlook incurred lower prices in Thursday's and Friday's trading sessions. Oil rose in the week 2.41%, from $52.83 the previous week to $55.24 on Friday on the back of the recent US response to the chemical attack in Syria and resultant rhetoric between Russia and the US.Gas prices trended down on Monday on weaker demand and strong incoming Norwegian gas flows. This was despite an unplanned outage at the South Hook LNG terminal and the Oil price closing just over 1%. higher  On Tuesday, a deficit of gas supply against UK demand resulted in prices gaining. 

A drop in Norwegian supply contributed mostly to system tightness along with gas volumes from the UK being shipped to the continent through the interconnector pipeline. Contracts further along gained: the Oil price shifted upwards, caused by disruption to Libyan output. The GB Pound also faltered against the Euro on the Scottish Parliamentary vote.

Mid-week, the rising price trend lingered with higher demand, reduced LNG and Norwegian gas flows adversely driving. The Oil price continued to gain and the Pound continued to weaken on the triggering of Article 50 although currency movements did improve during the day.  Although demand dropped on the penultimate day (thanks to hot weather) Brent Crude hit a (high) price point, one not seen in 16-days, on lower than envisaged U.S. crude stocks.  The week overall closed higher because of more bullish trading days than not.

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