Energy Wholesale Market Review
Energy Wholesale Market Review Week Ending 27th June 2014
Despite further rises in oil prices, GB electricity and gas contracts returned to downward trends with high gas storage supplies and low demand predictions influencing the falls. The annual October 14 gas contract shed 2.7% to 56.1p/th, a new low, as storage supplies surged 13% higher. Its power counterpart followed the trend, hitting its own record low of £48.3/MWh. In contrast, day-ahead power and gas both rose 1.2% following mid-week supply shortages. The annual clean spark spread was unchanged this week at £4.6/MWh, while the annual clean dark spread fell 6.2% to £16.8/MWh as a result of power prices falling faster than coal. API 2 coal prices fell 0.3% to settle at $78.5/t, a new four-year low, as further highs were recorded for European stockpiles. In contrast, Brent crude oil prices continued to rise with geopolitical risks in Ukraine, Libya and Iraq adding to security of supply fears. The contract hit a nine-month high of $115.2/bl on Monday.
Energy Wholesale Market Review Week Ending 27th June 2014.
Energy Wholesale Market Review Week Ending 20th June 2014
Concerns about instability in Iraq and Ukraine affecting fossil fuel supplies were outweighed by lower demand and high storage supplies. The annual October 14 gas contract inched 0.3% upwards to 57.7p/th but the annual October 14 baseload power contract dipped 0.3% to £49.3/MWh. Day-ahead prices were influenced by comfortable supplies and lower summer demand. Day-ahead gas fell 2.9% and day-ahead power dropped 4.8% to £35.8/MWh. The annual clean spark spread was down 5% on falling power prices while the annual clean dark spread rose 1.1% and is now at a £13.4/MWh premium to the spark spread. Month-ahead Brent crude oil reached a nine-month high of $114.7/bl on Friday as fighting in Iraq began to affect oil production facilities, raising concerns about security of supply. Annual API coal prices continued to fall on strong stockpiles and good supplies, the contract dropped to $79.0/t on Friday.
Energy Wholesale Market Review Week Ending 20th June 2014.
Energy Wholesale Market Review Week Ending 13th June 2014
Following the seizure of large parts of Northern Iraq by militants, oil prices jumped up to nine-month highs. This had the effect of pushing up the gas and power markets despite continuing low demand and comfortable supplies. Annual October 14 baseload power rose 1.4% to £49.5/MWh after its gas counterpart climbed 1.2% to 57.5p/th. Clean spark and dark spreads both rose as power climbed further than gas, the annual clean spark spread is now £4.9/MWh, 53% higher than last year but £12.7/MWh lower than the annual clean dark spread. Month-ahead Brent crude oil climbed to a nine-month high of $114.2/bl on Friday following concerns about tensions in Iraq. Coal prices continued to fall, dropping 1% to average $79.8/t for the week as a result of strong supplies and robust stockpiles. Carbon prices climbed 3.8% to average €5.5/t as German ministers expressed a preference for early reform of the market.
Energy Wholesale Market Review Week Ending 13th June 2014.
Energy Wholesale Market Review Week Ending 6th June 2014
Recent trends of below average demand and high supplies continued to suppress power and gas prices this week. Day-ahead gas suffered the largest falls, as further LNG and continental deliveries saw the contract shed 12.2% week-on-week to 37.1p/th, a new four-year low. The reductions resulted in coal becoming the marginal fuel on the system. Along the curve, winter 14 gas dropped 3.1% to a four-year low of 58.9p/th, helping falls in both annual October 14 gas and power. Power contracts followed falls in gas and were also influenced by historic lows for coal prices, day-ahead power hit a new four-year low of £37.7/MWh. In spreads, the annual October 14 clean spark spread was unchanged at £4.6/MWh as gas and power prices both fell at near equal rates, while the annual October 14 clean dark spread lost 4.1% to £16.8/MWh as power prices fell faster than coal. Falls in oil and coal added to bearish trends in power markets, with API 2 coal dropping to a four-year low of $79.8/t as cheaper US imports continued to enter the European market.
Energy Wholesale Market Review Week Ending 6th June 2014.
Written By Graham Paul
