Standard content for Members only
To continue reading this article, please login to your Utility Week account, Start 14 day trial or Become a member.
If your organisation already has a corporate membership and you haven’t activated it simply follow the register link below. Check here.
“Strong price moves have returned in November”
Popular stereotype would have it that the British are obsessed with the weather.
But the British population as a whole has nothing on the UK’s gas market traders, who throughout the winter months will be analysing every fluctuation in degrees Celsius as if their bonuses depend on it.
Each forecast revision, and deviation from the seasonal norm, will be scrutinised against the impact it will have on gas demand across the UK – which of course helps set the market price.
Just a few weeks ago, when asked why pricing levels on the gas market have continued to slip, one trader told Utility Week: “The leaves are still on the trees.”
Such Confucian-esque comment on the direction of trade makes sense when you consider the historically mild autumn temperatures seen so far this year, and the low gas heating demand as a result.
So the market will have welcomed the chilly first week of November as market activity and strong price moves returned.
For the rest of the month, temperatures are expected to be in line with seasonal norms.
But the market needn’t worry about a boring stretch of low demand and ample storage levels. Bloomberg reports that from December through to February, weather will turn considerably colder than last year.
Hardly what I’d call great news, but while mild weather may be welcomed by most it does make for a rather dull start to the winter trading season.
Please login or Register to leave a comment.