Business Energy Market Brief - Apr18
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Energy Market ReportsBusiness Energy Market Brief - Apr18

Business Energy Market Brief - Apr18

Ian Mckenna

by Ian Mckenna 04 April 2018

Report Summary:

Robust gains observed across power and gas

key-market-indicatorsEnergy Market Brief - Apr18

Gains were observed across most power and gas contracts in March, with notable near-term growth as day-ahead gas reached its highest price since at least 2008.

On 1 March day-ahead gas prices reached 125.0p/th, their highest level in at least 10 years. Early month gains were driven by National Grid announcing a gas deficit warning, while demand sored to a five-year high amid below-average temperatures supplied by ‘the Beast from the East’. Outages at South Hook LNG terminal and the Kollsnes gas processing site further tightened supplies. On average day-ahead gas prices rose 17.8% to 64.1p/th. Bullish growth was observed across all seasonal gas contracts, rising 2.4% on average. The largest gains were on the near-curve as summer 18 and winter 18 gas increased 5.8% and 4.1% to average 44.8p/th and 52.3p/th respectively.

Day-ahead power leapt 12.3% to average £57.9/MWh. On 1 March prices reached an 18-month high of £98.0/MWh. Bullish gas and carbon prices throughout the month supported power prices. On average seasonal power contracts grew 1.8% across March. The summer 18 and winter 18 contracts lifted 4.8% and 4.1% to average £45.3/MWh and £51.0/MWh.