Energy Wholesale Market Review
Energy Wholesale Market Review Week Ending 26th August 2016
The majority of wholesale power and gas contracts decreased this week. Seasonal gas contracts dropped to multi-month lows, with gas for winter 16 experiencing the largest decline on news that Centrica will make 20 wells available at Rough gas storage facility from 1 November 2016. The news pulled the contract down to a two-month low of 39.8p/th on Thursday. Week-on-week, day-ahead gas was broadly unchanged, but fell to 27.0p/th on Monday, the lowest price in over six years. Day-ahead power (for delivery Bank Holiday Monday) dropped 6.0% to £35.1/MWh with demand expected to be low on the Bank Holiday. All seasonal baseload power contracts also went down. Winter 16 power trimmed 1.6% to £45.6/MWh, hitting a two-month low of £45.2/MWh on Thursday. The day-ahead clean dark spread (coal) once again turned negative, falling to -£1.6/MWh. This has continued to encourage coal-to-gas switching, with figures issued by BEIS on 25 June revealing that in the three months to the end of June coal’s share of the generation mix was down to its lowest level in 21 years at 6.8%.
Energy Wholesale Market Review Week Ending 26th August 2016
Energy Wholesale Market Review Week Ending 19th August 2016
Most gas and power contracts declined this week. On the near-curve gas contracts showed notable reductions, with day-ahead gas dropping 11.6% to 28.3p/th, the lowest price since April this year. The fall in price occurred as domestic supplies of gas ramped up following the end of maintenance at the Britannia gas field and Apache’s SAGE terminal. Day-ahead power went down 1.7% week-on-week to £37.4/MWh. Further out, seasonal gas contracts lifted 0.6% on average, as a boost in oil prices supported the NBP market. The only seasonal contract to experience a decline was winter 16, which fell just 0.8% to 42.0p/th. Meanwhile, all seasonal baseload and peak power contracts gained. Winter 16 peak power lifted 0.8% to £56.6/MWh. The contract is now £10.3/MWh higher than its baseload counterpart, owing to concerns arounds supply margins for the coming winter. Brent crude oil prices climbed 9.0% this week to average $49.0/bl, an eight-week high, on the prospect that oil exporters will discuss ways to support the oversupplied market.
Energy Wholesale Market Review Week Ending 19th August 2016
Energy Wholesale Market Review Week Ending 12th August 2016
Gas and power contracts experienced mixed trends this week. On the near-curve gas contracts showed notable declines, with day-ahead gas dropping 5.7% to 32.0p/th, the lowest price since May this year. Declines have been attributed to low demand levels and comfortable supplies, which left the gas system oversupplied. In contrast, day-ahead power jumped 8.9% to £38.0/MWh, with wind output forecast to decline significantly. Further out, most seasonal gas contracts followed oil prices higher. The only exception was winter 16 which fell 0.2% to 42.3p/th. Meanwhile, seasonal baseload and peak power contracts showed diverging trends, with those in the near-term rising. Winter 16 peak power rose to £56.2/MWh, £10.3/MWh higher than its baseload counterpart, owing to concerns arounds supply margins for the coming winter. Brent crude oil prices climbed 4.9% to average $45.0/bl on the prospect that oil exporters will discuss ways to support the oversupplied market.
Energy Wholesale Market Review Week Ending 12th August 2016
Energy Wholesale Market Review Week Ending 5th August 2016
Gas and power contracts decreased across the board this week. Day-ahead gas declined 5.0% to 34.0p/th, with supply generally outweighing demand and flows mostly above the seasonal norm. Day-ahead power dropped 11.4% to £34.9/MWh, amid high wind output and a fall in power demand. Winter 16 gas fell 4.0% to 42.4p/th, following oil prices lower. Winter 16 power slipped 2.0% to £45.6/MWh, following its gas counterpart lower. Brent crude oil reduced by 2.4% to average $42.9/bl this week. Prices lowered amid continued concern regarding global oversupply and higher OPEC production. Prices recovered at the end of the week to $43.8/bl on Friday. API 2 coal reduced 8.6% to $55.8/t and on 4 August prices were at $58.2/t, the lowest price in three weeks. However, prices have shown a significant recovery since reaching a low point of $36.6/t in February 2016. Week-on-week EU ETS carbon went up 8.2% to €4.8/t, however on 2 August prices fell to €4.4/t, the lowest price since March 2014.
Energy Wholesale Market Review Week Ending 5th August 2016
Written By Graham Paul
