Market Insight
Tony Jordan
3 February 2023

Market Insights 03/02/2023


Markets showed a bearish session yesterday, after a series of small bullish ones so far this week, despite potential fears of a cold spell heading our way.

ACER set the new EU LNG reference price at €55.21 on Wednesday, around €4 from where the TTF market was on the same day – and far from the €35 spread required to trigger the new cap.

Russias Lavrov says the US was ‘directly involved’ in the Nord Stream AG explosion. This comes after President Putin previously announced that the UK was involved. Both countries have denied any involvement.

Centrica‘s British Gas hit headlines yesterday around the practices of forced prepayment meter installs on their customers whose energy accounts fall into arrears – many of whom are designated as ‘vulnerable’. Centrica CEO Chris O’Shea publicly apologised. This was quickly followed by EDF (UK) (and others) to state they had suspended the practice whilst undertaking internal reviews. Ofgem CEO Jonathan Brearley made a stern statement instructing suppliers to make sure their ‘house was in order’ as the regulator launched an investigation.

The latest long term weather run shows a dip in near term temperatures but returning to above seasonal normal until the end of the month – however a cold spell in March is currently to be expected.

Yesterday saw the TTF March contract settle at €57.04 (from €59.53) and the NBP March contract at 143.97p (from 152.07p).

Kollsnes remains on unplanned outage this morning and we see a flow level at 335mcm from Norway (327). Russian nominations showing Velke Kapusany at 25.2mcm (23.7) and Sudzha at 30.8mcm (29.3). Nord Stream remains unavailable.  Gas storage showing at 71.64% full as per AGSI+. LNG vessels due to arrive in UK next couple of weeks is 10.

This morning we see the March TTF contract at €57, NO CHANGE to the previous settlement. 

A quick check on some key contracts:
Curve TTF March €57, Summer €59 (vs €57 and €62)
Curve NBP March 144p, Summer 151p (vs 152p and 157p)
UK Gas NBP spot 145p (from 162p).
UK Power DA £128 (from £130).

UK power prices show the UK March Baseload contract at £150 (£151) and Summer at £152 (£155).

In other areas of the market Brent Oil is at $82 ($83) and EUAs are at €93 (€95). Henry Hub is at $2.46 ($2.47) and JKM is at $18.37 ($18.97) with TTF Equiv of $18.28 ($19.08).

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