Market Insight
Tony Jordan
6 December 2022

Market Insights 06/12/2022

Back to the bears in yesterdays session as we continue the holding pattern for now around the current levels.

Today, from 11.30am, will see the UK Chancellor announce his autumn statement, widely expected to increase taxes in order to plug the huge budget gap. It is also expected to see a £3,000 price cap (from the current £2,500) for the average household from April. This comes as today marks the first day of the Ofgem observation window for the April cap. Currently the forecast for April will not be too much higher than the expected revised cap. We’ll monitor this closely over the coming days.

Elsewhere the rumour mill continues around the delayed restart of Freeport LNG with tankers now seeking alternative ports to load after waiting in anticipation for an imminent start. The terminal itself has been quiet with updates, but any restart is now expected to be several more weeks away yet.

The AGSI+ website shows the first overall net decrease in storage levels of the season, albeit very small, suggesting withdrawals may have now commenced in some countries.

Yesterday saw the TTF December contract settle at €113.90 (from €124.10) and the NBP November contract at 269.73p (from 298.95p).

Asgard on unplanned outage this morning and we see a flow level at 299mcm from Norway (299). Russian nominations showing Velke Kapusany at 40.7mcm (40.5) and Sudzha at 42.4mcm (42.4). Flows on Nord Stream are now a likely physical impossibility. Gas storage showing at 95.46% full as per AGSI+. LNG vessels due to arrive in UK next couple of weeks is 17.

This morning we see the December TTF contract at €105, DOWN €9 to the previous settlement. 

A quick check on some key contracts:
Curve TTF December €105, Summer €121 (vs €114 and €129)
Curve NBP December 279p, Summer 286p (vs 299p and 297p)
UK Gas NBP spot 80p (from 115p).
UK Power DA £117 (from £127).

UK power prices show the UK December Baseload contract at £265 (£295) and Summer at £255 (£258).

In other areas of the market Brent Oil is at $93 ($94) and EUAs are at €73 (€77). Henry Hub is at $6.20 ($6.03) and JKM is at $25.89 ($27.79).