Energy Wholesale Market Review
Energy Wholesale Market Review Week Ending 26th September 2014
Power and gas prices were mixed this week, with an undersupplied gas system leading to bullish spot gas price trends and resurgent wind output helping power contracts fall. Day-ahead gas rose 2.5% to 50.5p/th, a three-week high, as undersupply continued following extensions to Norwegian gas field outages. Despite a high proportion of gas in the generation mix, day-ahead power fell as a four-week high for wind output pulled the contract down to £42.4/MWh. Long-term contracts were also mixed, as higher power demand forecasts pushed annual October 14 power up 0.4% to £50.2/MWh, while a bearish gas market outlook for Q4 helped annual October 14 gas down 0.2% to 57.3p/th. Further falls in coal typified wider commodity trends, as the annual contract fell 1.7% to a new four-year low of to $75.4/t amid fears of further oversupply in the market. Brent crude oil prices declined 0.7% to a two-year low of $96.8/bl, while EU ETS carbon prices hit a 10-week low of €5.7/t as rumours emerged of a voting delay for proposed market reforms.
Energy Wholesale Market Review Week Ending 26th September 2014
Energy Wholesale Market Review Week Ending 19th September 2014
Once again short and long-term power and gas contracts showed diverging trends this week, as a tight spot gas market and a strong supply picture influenced. Spot contracts surged higher week-on-week, as a tight gas system, following ongoing Norwegian maintenance and higher Belgian exports, pushed prices higher. Day-ahead gas rose 9.7% to 49.3p/th and, as gas fuel returned to dominate power generation, day-ahead power followed higher. The contract climbed 6.6% to £43.1/MWh. In contrast, longer-term contracts were down this week as the lack of development in Russia/ Ukraine tensions switched market focus to the high gas supply picture. Winter 14 power was down 1% to £50.8/MWh. The annual October 14 clean dark spread gained 1.6% to reach £18.5/MWh, a new five-month high, as coal prices fell faster than power. Commodity prices were bearish. Brent crude oil prices remained below $100/bl this week, dropping 1.2% to average $97.8/bl, while carbon prices were down 4.4% to average $5.9/t. API 2 coal prices dropped to a new four-year low of $76.5/t as global oversupply concerns increased following China’s import ban on low grade coal.
Energy Wholesale Market Review Week Ending 19th September 2014
Energy Wholesale Market Review Week Ending 12th September 2014
Short and long-term power and gas contracts showed diverging trends this week, as continued geopolitical tensions and a strong supply picture both influenced the market. Short-term contracts were down with returning supplies, as day-ahead gas dropped 6.7% to 44.9p/th on returning continental imports. Day-ahead power followed the falls in gas, decreasing 9.1% to a three-week low of £40.5/MWh. In contrast, most long-term contracts rose, as increased fears over Russian gas supplies managed to outweigh16-month low oil prices and record high GB gas supplies. Winter 14 gas rose 0.6% to 59.9p/th, while winter 14 power was up 0.5% to £51.3/MWh. In spreads, the annual October 14 clean dark spread gained 0.1% to reach £18.2/MWh, a new five-month high, as coal prices fell and power rose. Seasonal power and gas contracts rose despite bearish trends on the commodity markets. Brent crude oil fell below $100/bl for the first time since April 2013, averaging $99.0/bl, as low demand forecasts combined with record high supplies. EU ETS carbon prices also dropped, down 2.2% to average €6.1/t, as lack of progress surrounding reform negotiations continued to dampen market sentiment. API 2 coal prices hit an eight-week low of $77.7/t.
Energy Wholesale Market Review Week Ending 12th September 2014
Energy Wholesale Market Review Week Ending 5th September 2014
Power and gas prices remained volatile this week as contracts reacted to positive sentiment surrounding Russia/ Ukraine ceasefire talks and also to the bullish impact of extended nuclear outages. Overall, most contracts rose week-on-week. Annual October 14 power gained 1% to £50.3/MWh as nuclear outages sparked fears for the winter-ahead. Gas contracts also responded, with CCGT plant expected to meet the nuclear shortfall. Day-ahead gas was up 7.5% week-on-week, reaching a four-month high of 49.5p/th on Thursday. Day-ahead power followed higher, and was also affected by three-month lows for wind output. The contract hit a five-month high of £45.4/MWh Tuesday. In spreads, the annual October 14 clean dark spread gained 4.3% to reach £18.2/MWh, its highest level in five-months. Commodities continued to steer clear of volatility. Brent crude oil was down 0.5%, reaching a 15-month low of £101.8/bl as supply factors continued to outweigh global geopolitical tensions. Carbon prices dropped 0.8% to average €6.2/t, and permits fell to a four-week low of €6.1/ on Friday as a lack of news surrounding market reforms caused bearish sentiment.
Energy Wholesale Market Review Week Ending 5th September 2014
Written By Graham Paul
