The UK’s Day-Ahead gas rose 11.3% to 38.40p/therm amid the fear of continued strikes restricting production at Norwegian fields and potential cold weather increasing heating demand.
Day-Ahead power rose by 1.7% to £41.49/MWh as low-pressure weather continues to persist over much of the UK, creating unsettled weather conditions and hindering solar generation. UK power demand could fall following Boris Johnson’s expected address on Monday evening as hospitality venues may be forced to close in parts of England as COVID-19 cases continue to rise.
Summer 2021 gas rebounded 6.5% this week, rising to 34.57p/therm due to lower supply, as UKCS and Norwegian gas production is forecasted lower, and increased regulation reduces Dutch production.
Summer 2021 prices rose by 3.2% to £43.88/MWh following the movement in gas, as carbon prices fell almost 5%.
The UK gas system opened 8 mcm/d oversupplied this week as Norwegian gas flows to Europe have risen following the end of strikes which had reduced flows for 10 days. Maintenance at Norway’s Karsto is also scheduled to end early this week.
For businesses not renewing until early-2021, October may be the last opportunity to lock in contracts while energy prices remain low. If your contracts are not renewing until Oct-2021, there may be another opportunity for you during summer 2021. But it may be a good idea to lock in any earlier renewals as soon as possible before winter temperatures arrive.