Energy Wholesale Market Review
Energy Wholesale Market Review Week Ending 30th June 2017
The majority of power and gas contracts increased this week. Week-on-week, Brent crude oil, API 2 coal and EU ETS carbon all experienced gains. On Friday, day-ahead baseload and peak power contracts retreated after reaching their highest levels since December 2016 last week. Week-on-week, baseload day-ahead power dropped 32.8% to £43.5/MWh and its peak power counterpart fell 42.4% to £49.0/MWh. Week-on-week day-ahead gas rose 1.1% to 36.0p/th as lower Norwegian imports due to an outage at the Entry SEGAL pipeline system lent support to prices during the week. All seasonal gas contracts increased this week, following oil prices higher. Week-on-week, winter 17 gas gained 0.7% to 44.7p/th, and summer 18 gas went up 0.2% to 38.6p/th. All seasonal baseload power contracts moved higher this week, following their gas counterparts. Winter 17 power lifted 1.0% to £46.4/MWh. Summer 18 power increased by 0.6% to £39.5/MWh. Brent crude oil prices lifted 0.8% to average $46.8/bl. A weakening US dollar supported oil prices throughout the week. In addition, US Energy Information Administration data showing a decrease in US crude production, caused by tropical storm Cindy, and a fall in US gasoline inventories helped extend gains. API 2 coal increased 0.8% to average $69.8/t. On Thursday prices hit a seven-month high of $70.5/t. Prices were driven higher by the strengthening of the euro against the US dollar.
Energy Wholesale Market Review Week Ending 30th June 2017
Energy Wholesale Market Review Week Ending 23rd June 2017
The majority of power contracts and all near-term gas contracts increased this week. Most seasonal gas contracts experienced losses, with a fall in oil and carbon prices. In contrast, coal prices moved higher. On Friday, day-ahead baseload and peak power contracts hit their highest levels since December 2016, with tight supply margins forecast for Monday, amid projections of lower wind and solar generation and higher demand. Week-on-week, baseload day-ahead power jumped 77.4% to £64.8/MWh and its peak counterpart leapt 155.6% to £85.0/MWh. Week-on-week day-ahead gas rose 21.7% to 35.6p/th, rebounding from last week’s nine-month low following an end to the recent heatwave. The month-ahead contract climbed 3.1% to 35.5p/th. Most seasonal gas contracts decreased this week, following oil prices lower. Week-on-week winter 17 gas lost 0.8% to 44.4p/th. Summer 18 gas went down 1.3% to 38.6p/th. All seasonal baseload power contracts moved higher this week. Winter 17 power lifted 0.5% to £46.0/MWh. Brent crude oil prices continued a downward trend this week, falling 3.0% to average $46.4/bl, and ending the week at $45.3/bl. On Thursday, prices declined to $45.2/bl, the lowest price since 14 November 2016, amid concerns over the continued oversupply of oil and increasing output in Libya, Nigeria and the US. API 2 coal increased 1.5% to average $69.2/t. On Tuesday prices hit a seven-month high of $69.7/t.
Energy Wholesale Market Review Week Ending 23rd June 2017
Energy Wholesale Market Review Week Ending 16th June 2017
All gas contracts and most power contracts declined this week, with a fall in oil prices and carbon prices. In contrast, coal prices rose. Day ahead gas and power contracts reached nine-month lows on Thursday. On Thursday, the day-ahead gas contract hit a nine-month low of 23.5p/th, amid warmer weather, high levels of forecast renewables output and fewer continental exports which lowered gas demand and increased available supply. Interconnector UK (IUK), between GB and Belgium, is shut for annual maintenance from 14 June to 29 June, preventing the export of gas and adding to the oversupplied system. The day-ahead baseload power contract slid to a nine-month low of £30.8/MWh on Thursday, pressured downwards by falling gas prices, as well as high levels of forecast wind generation and solar generation. The day-ahead peak power reached a nine-month low of £33.3/MWh on Thursday, following its gas and baseload power counterparts downwards. Week-on-week day-ahead peak power lost 16.9% to £33.3/MWh. The contract was £3.3/MWh lower than its baseload counterpart, due to high levels of solar output lowering peak demand levels. All seasonal gas contracts decreased this week, following oil prices lower. The majority of seasonal baseload power contracts moved lower this week, following gas prices downwards. Brent crude oil prices continued a downward trend this week, falling 2.3% to average $47.9/bl.
Energy Wholesale Market Review Week Ending 16th June 2017
Energy Wholesale Market Review Week Ending 9th June 2017
Higher gas and coal prices pushed most baseload power contracts higher this week. An exception was day-ahead baseload power, which dropped 7.1% to £36.0/MWh. The contract slid to a near nine-month low on Tuesday of £35.8/MWh as record levels of renewables generation during peak times pushed spot prices lower. On Wednesday, renewables provided 18.7GW of power at 1pm, meeting a new record of 50.7% of total demand. Consequently, within-day power prices on APX and N2EX exchanges fell negative, owing to too much inflexible generation on the system. Negative prices were also seen on the Balancing Mechanism, with wind farms being paid to reduce their output. The month-ahead power contract (July) increased by 0.8% to £39.7/MWh. All near-term gas contracts rose this week, as a weaker pound following the general election supported prices. A weaker pound against other currencies increases the cost of importing gas. Week-on-week, the day-ahead gas contract gained 2.2% to 37.5p/th, as lower temperatures led to higher residential gas demand. The month-ahead (July) contract rose 3.0% to 37.3p/th. Brent crude oil prices dropped 3.8% to average $49.0/bl. On Friday, prices dropped to a six-month low of $48.0/bl amid concerns over increasing US crude inventories and rising oil production from Libya. Prices also faced downward pressure from rising tensions in the Middle East after Saudi Arabia and other Arab states severed diplomatic ties with Qatar.
Energy Wholesale Market Review Week Ending 9th June 2017
Energy Wholesale Market Review Week Ending 2nd June 2017
Higher gas, coal and carbon prices pushed most baseload power contracts higher this week. Day-ahead power, followed its gas counterpart upwards, jumping 5.0% to £38.8/MWh, with higher demand forecast for Monday. Contracts moved forward this week and the new month-ahead contract (July) increased by 0.8% to £39.4/MWh. Seasonal baseload power contracts experienced mixed movements. Winter 17 power lifted 0.1% to £45.8/MWh. Day-ahead peak power jumped 9.8% to £41.5/MWh. The contract ended the week £2.8/MWh above its baseload counterpart. The majority of near-term gas contracts experienced losses this week, following oil prices downward. The only exception was the day-ahead contract, which increased 0.5% to 36.7p/th, week-on-week. The new month-ahead (July) contract slipped 3.3% to 36.2p/th. Throughout the week higher Norwegian deliveries pushed prices lower. All seasonal gas contracts decreased this week. Winter 17 gas lost 1.8% to 45.3p/th. Brent crude oil prices dropped 4.7% on average to $50.9/bl. Week-on-week, prices plummeted to a near four-week low of $49.1/bl, amid concerns that the United States’ withdrawal from the Paris climate agreement could lead to more crude drilling in the US. API 2 coal lifted 0.3% to average $66.9/t. On Wednesday, prices reached an eight-week high of $67.5/t. EU ETS carbon prices gained 3.1% this week to average €5.1/t. On Tuesday, prices hit a near twelve-week high of €5.2/t.
Energy Wholesale Market Review Week Ending 2nd June 2017
Written By Graham Paul
