Gas market shenanigans continue as players start to look carefully at the volatillity market, which continues to be over priced with stigma of fear in the gas market.
The gas market responded yesterday to the slight falls seen on Wednesday. Spark spreads continued to narrow as players still see the power market fundamentally over supplied. Gas is more open to manipulation and this has meant that intradday volatility is much higher.
Interestingly although the markets are moving they are very rangebound between £40.50 to £42.50 and this is why sellers of options will be laughing as volatility is in reality very low but players will continue to pay up for the possibility of the unexpected in the gas market.
The really smart play is to buy a few wingy options in gas and sell at the money options in power, this covers your initial outlay costs but it hedges you between markets as well.
02 December 2005
Traders waiting for Christmas as market throws enticing opportunities their way. read more...
09 November 2005
Clean dark spread cheaper than the clean spark as gas sellers go on holiday. German demand for emissions allowances produces semi-squeeze in prices. read more...
07 March 2005
Mild weather forces drops which are tempered by a very bullish emissions price. read more...
15 February 2005
Curve bounces towards upper range, with bullish activity in the prompt and the gas market. read more...
Confidence Returns to Market
Despite a continuation of cold conditions, confidence was seen returning to the market with a stabilisation of spot prices and comfortable system margins. There was some focus on the curve with seasonal contracts all reporting some gain on the previous weeks levels apart form Summer 13. read more...
20 December 2010
Despite a continuation of cold conditions, confidence was seen returning to the market with a stabilisation of spot prices and comfortable system margins. There was some focus on the curve with seasonal contracts all reporting some gain on the previous weeks levels apart form Summer 13. read more...
Weather continues to dominate
Tight margin concerns resulted in Spot prices reaching highs for nearly two years. The cold weather conditions were the driving force though supply issues compounded the situation. read more...
10 December 2010
Tight margin concerns resulted in Spot prices reaching highs for nearly two years. The cold weather conditions were the driving force though supply issues compounded the situation. read more...
Cold snap results in single highest gain since Jul-09
Prompt contracts responded to the expected cold spell forecast for this week with the Day Ahead contract (Baseload contract for Monday delivery) on Friday gaining £2.65/MWh – the single highest gain seen since July on this contract. This bullish sentiment did not feed through to the rest of the curve though. read more...
08 November 2010
Prompt contracts responded to the expected cold spell forecast for this week with the Day Ahead contract (Baseload contract for Monday delivery) on Friday gaining £2.65/MWh – the single highest gain seen since July on this contract. This bullish sentiment did not feed through to the rest of the curve though. read more...
Gains Seen Across the Curve
There was no sign of an early Christmas in the power market on Friday with a 'flurry' of trading resulting in gains across the power curve. read more...
21 December 2009
There was no sign of an early Christmas in the power market on Friday with a 'flurry' of trading resulting in gains across the power curve. read more...
Market forgets basic principles and panics!
It could be said that the market over reacted today in the prompt market with a price rally on the back of a £142 half hourly cash out price. read more...
02 October 2009
It could be said that the market over reacted today in the prompt market with a price rally on the back of a £142 half hourly cash out price. read more...
February Monthly Round Up
February was dominated by news of unrest spreading throughout the Middle East and this had a direct impact on all aspects of the UK energy market with gains seen in the UK Power and NBP Gas curves. read more...
25 February 2011
February was dominated by news of unrest spreading throughout the Middle East and this had a direct impact on all aspects of the UK energy market with gains seen in the UK Power and NBP Gas curves. read more...
Where has the market got left to go?
Clean spark spread prices in Winter’s 11 and 12 are trading below £5.00MWh (closing at £4.87 and £4.59 respectively). The equivalent Summer’s are not that much stronger asking some to ask is there anymore downside left at these levels. read more...
03 September 2010
Clean spark spread prices in Winter’s 11 and 12 are trading below £5.00MWh (closing at £4.87 and £4.59 respectively). The equivalent Summer’s are not that much stronger asking some to ask is there anymore downside left at these levels. read more...
Where's the certainty?
There was a time when you could quite comfortably forecast the running order of generation plant in the UK - but 2009 has seen a dramatic turn in the stack! read more...
23 December 2009
There was a time when you could quite comfortably forecast the running order of generation plant in the UK - but 2009 has seen a dramatic turn in the stack! read more...
Drax up against it
Drax profit margins fall as competition will only get harder. read more...
05 March 2008
Drax profit margins fall as competition will only get harder. read more...
New White Paper highlights need for Energy Risk Management
Yesterday, npower launched its new white paper, commissioned from the London School of Economics on Energy Risk Management for UK business. The paper comes on the back of research that suggests that UK businesses now feel that energy presents a higher level of risk to their business than health and safety and security issues. But what should businesses be doing to manage the risks? read more...
11 November 2010
Yesterday, npower launched its new white paper, commissioned from the London School of Economics on Energy Risk Management for UK business. The paper comes on the back of research that suggests that UK businesses now feel that energy presents a higher level of risk to their business than health and safety and security issues. But what should businesses be doing to manage the risks? read more...
Night Night Power Market!
The market seems warm and cosy (aka stable with low volatility) - but wait until the players return in September! read more...
07 August 2009
The market seems warm and cosy (aka stable with low volatility) - but wait until the players return in September! read more...
An options strategy to suit.
Options are creaping into flexible contracts and this is a good thing as they can provide insurance, but in reality, often they appear to be given away, but look carefully and what you are giving away in return. read more...
31 October 2007
Options are creaping into flexible contracts and this is a good thing as they can provide insurance, but in reality, often they appear to be given away, but look carefully and what you are giving away in return. read more...
Summary of the week.
The market continues to baffle as players gear up for the winter read more...
28 September 2007
The market continues to baffle as players gear up for the winter read more...
What a volatile week!
Market moves for next week could be very interesting. read more...
21 September 2007
Market moves for next week could be very interesting. read more...
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