Market Insight

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Thurs, 18th Apr ’24


  • Notably, Winter-24 delivery prices were at a significant premium versus Seasonal delivery thereafter until Mar ’24 when Winter-24 delivery was very briefly offered at a discount to subsequent Seasons (see chart).
  • At the time of writing however, Winter-24 has lifted once again and only Winter-25 is more expensive versus the rest of the curve.
  • This shift, of course, is an impact of recent geopolitical tensions in the Middle East (further exacerbated by short-term supply issues at Freeport, Texas and Nyhamna, Norway).
  • This morning prompt (near-term delivery) contracts were down at open off the back of a long system (supply outrstripping demand forecast).
  • Curve (far-term delivery) contracts also opened lower this morning, continuing yesterday’s more bearish tone.
  • Notwithstanding geopolitical risk, key drivers remain mostly bearish with European storage at 62% versus the 5-year average of 43%.
  • The extended Norwegian outage at Nyhamna has now come to an end (ramping up Langeled pipeline nominations).
  • Storage withdrawals have slowed with temperatures forecast to rise back above seasonal norms come the weekend.
  • Market participants are still weighing-up next steps in the Middle East after Israeli officials confirmed that Israel would be responding to Iran’s drone attacks.
  • All in all, a bearish/corrective tone to the market today.
  • Monthly Day-Ahead averages are on target this month to achieve 70p/therm (or 2.4p/kwh).


  • Looking to the continent, European near-term delivery prices cleared mixed yesterday – though prices are expected to drop today off the back of reduced geopolitical hysteria and improved renewables outputs.
  • Down the curve, prices dropped off alongside the gas and carbon markets yesterday, pressured by increased Norwegian supply and a long-awaited correction of EUAs (European mandatory carbon allowances for big emitters).
  • The carbon slide was likely fuelled by some profit taking given the overcooked increases we’ve seen over the past few sessions (against a backdrop of contrarian fundamentals).
  • The COT (Commitment of Traders report) published yesterday was surprisingly unchanged versus that which was published before this week’s bull run.
  • Speculators saw their net short position reduced only very marginally compared to the previous week – an unexpected result given the large increase of carbon prices (which are now being attributed mainly to short-covering).
  • Back in the UK, Dec-24 contracts for UKAs are circa. £36/tn.
  • Our electricity generation mix is very bearish in nature today with renewables contributing 54%, thermal at 7% (gas and coal) and low carbon at 25% (nuclear and imports).
  • Monthly Day-Ahead averages are on target this month to achieve £41/mwh (or 4.1p/kwh).



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