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Energy Market Trends: November 2023

30 November 2023

Our Risk Manager, Alex Mottershead breaks down the market factors that have influenced gas and electricity prices across November, crucial reading for any business exploring energy procurement.


Last week, most near curve UK power contracts felt upward pressure from cooler weather forecasts as the week progressed. Day-ahead power was delivered low as £75.87/MWh on Thursday 23rd, thanks to strong wind output, but as high as £110.14/MWh for delivery on Saturday 26th. The front month gained just under £4/MWh, between Monday and Friday, and further dated contracts traded relatively flat.

This week, losses have been observed across the board on revised weather forecasts and the continued strong supply picture. Previously, the current cold snap had been forecast to last until mid-December, but the latest runs put the resumption of normal temperatures around 10th December, with the remainder of December looking milder. The UK wind outlook for the coming week remains poor and this, coupled with cooler temperatures and lower UK nuclear output, will likely keep prompt prices elevated. On the continent, the wind outlook is better, and we’ve seen a 5% uptick on available French nuclear capacity on week. This is set to improve further as we head into December.

EUA carbon prices fell to €72.96/tonne during Wednesday’s trading with technical indicators and equities markets providing bearish signals. Auction results have been weak recently with bid-cover ratios below 2, which suggests weak demand. The weather could provide some strength later in the week as temperatures across Europe are set to sit below norms and looming contract expiry could increase buying interest, particularly given the level of short positions held.


UK gas contracts rallied across the curve towards the end of last week on colder weather forecasts. The front month contract gained 8p/th from the week’s low, with seasonal contracts gaining in the region of 3p/th.

This week, the front month contract has shed over 15p/th from Friday’s close, with the front seasonal contract falling 13p/th, thanks to the improved weather runs and the continued healthy supply/demand picture. Both UK and EU storage sits at 98% fullness and LNG cargos continue to arrive into NWE with frequency. Norwegian flows remain strong, with a record 354.4mcm/day exit nominations last Tuesday.

On Friday, the operator of the US Freeport LNG facility announced the regulator had given permission for the recommissioning of Phase 2 of its facility, following last year’s fire. This includes a second LNG loop and dock, meaning the facility will be able to export more LNG during the Northern Hemisphere winter. Phase 1 was recommissioned in Q1-23.

Oil prices tumbled almost $2/bbl last week on news that the OPEC+ meeting would now take place on 30th November, having been delayed 4 days. It was reported that the delay was down to disagreements on 2024 cut levels. The IEA has revised it’s 2024 demand forecast down, and US stockpiles jumped more than expected in the week to 17th November. With Chinese demand growth still lukewarm, the IEA has reported that even if OPEC+ cuts are extended into 2024, the global market will still see a supply surplus.

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