Weekly Price Update Report - Week 19
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Energy Market ReportsWeekly Price Update Report - Week 19

Weekly Price Update Report - Week 19

Nathaniel Taylor

by Nathaniel Taylor 07 May 2017

Report Summary:

Price falls across the week

week-on-week-changes

NBP Natural Gas & GB Power Market Movement

Prices gained on Tuesday on an undersupplied gas network brought about by the unplanned shutdown of gas producing facilities in Norway as well as higher gas exports to the continent. Prices softened mid-week on an oversupplied gas system today. Imports from Norway ramped up with an unplanned outage from the previous working day coming to an end and the UK exported less gas that day.  The oil price recovered with an API report showing that US Crude oil inventories had fallen by 4.2 million barrels but the bearish signals from the near market drove prices lower overall and across the board. 

Prices continued to trend down on Thursday. Norwegian imports rose nearly 9% compared to the previous day, boosted by the end of maintenance at the Kollsnes gas processing plant. Peak wind power output was forecasted at 7 GWs, another bearish driver, offsetting the impact of four nuclear reactors being offline. The oil price continued to adjust down on a lower than expected decrease in US inventories and growing US gasoline inventories. Week 19 prices closed the week lower compared to week 18, with strong losses recorded in the Oil market, this commodity ending lower week-on-week by 5.08%.Gas prices were mixed on Monday with prices on the near market rising driven by higher demand and colder weather and further ahead prices (2018+) driven down on a lower Crude oil market, with doubts lingering over OPEC production cuts and possible higher production from Russia.  Prices fell on Tuesday for May 2017+ contracts.

Despite bullish fundamentals that day, bearish movement on the Coal market outweighed the impact of a weaker GB Pound and a higher Oil price. The markets gained mid-week on continued cold weather and a (downward) adjustment to UK temperatures for May.  Also, whilst the Pound gained that day this was not enough to fend the bullish impact of a report released by the EIA showing a week-on-week drawdown of US stockpiles. 

A weaker Oil market was the main driver for falling wholesale prices on Thursday along with strong gas withdrawals from medium range gas storage sites and an improved weather outlook for the next working day.  Although demand fell on Friday, prices still trended up on news of an OPEC members meeting in May to discuss a possible extension to the ongoing output cuts.

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