Energy Wholesale Market Review
Energy Wholesale Market Review Week Ending 27th April 2018
Day-ahead gas rose 3.2% to 53.5p/th, increasing in response to cooler temperatures in the latter part of the week and unexpected supply outages in Norway. Month-ahead gas was the only gas contract to fall, dropping 0.9% week-on-week to 51.7p/th. All baseload power contracts increased this week. Week-on-week, day-ahead baseload power rose 5.6% to £53.5/MWh. Despite rising renewables output and falling coal-fired power generation, prices responded bullishly to higher gas prices and increased demand at the week’s end. Brent crude oil gained 0.6% week-on-week to average $74.4/bl. Bullish behaviour led to oil hitting a fresh three-and-a-half year high on 23 April at $75.4/t. Behaviour has been driven by geopolitical uncertainty between Iran and the US, and comes despite a rise US crude inventories and a strengthening US dollar. Week-on-week EU ETS carbon prices grew 2.1% to €13.4/t (up from €13.1/t). The average EUA price across the week was €13.2/t, down from the previous week’s average of €13.7/t. Week-on-week API 2 coal has reduced 0.3%, lowering to $83.t/t on 27 April from $83.3/t on 20 April. Most clean dark spreads increased this week. Although the majority of clean dark spreads remain below their clean spark counterparts, spreads for winter 18 are more favourable towards coal-fired power generation over gas. This comes despite a new record for zero-coal this week and suggests coal could play a role this winter.
Energy Wholesale Market Review Week Ending 27th April 2018
Energy Wholesale Market Review Week Ending 20th April 2018
This week was dominated by bullish movements in most wholesale contracts, as gas, power and commodity prices reached fresh multi-year highs. Day-ahead gas was the only gas contract to fall, dropping 2.3% week-on-week to 51.8p/th. The fall was driven by lower demand caused by higher than average temperatures across the week, as well as high levels of renewables output. May 18 gas reached its highest price since February 2017, hitting 52.2p/th. Nearly all peak power contracts experienced growth this week. Day-ahead peak power fell 2.5% to £52.2/MWh from the previous week. Seasonal peak power contracts experienced an average growth of 0.4% from the previous week, with only summer 20 seeing losses (down 0.3%). Day-ahead baseload power slipped 2.0% to £49.8/MWh. Prices were weighed on by increased wind and solar generation, which, in combination with lower demand, led to a UK record of 55 hours without coal-fired power plant generation. Brent crude oil gained 2.2% to average $72.0/bl, up from $70.5bl. Bullish behaviour led to oil hitting a fresh three-and-a-half year high on 19 April at $74.75/t. Bullish momentum has continued to be driven by the OPEC supply cap. EU ETS carbon prices reached a fresh seven-year high on 19 April, peaking at €14.2/t but averaged €13.6/t across the week. Prices fell to €13.1/t on 20 April, down 5.9% week-on-week, following profit-taking after the fresh high.
Energy Wholesale Market Review Week Ending 20th April 2018
Energy Wholesale Market Review Week Ending 6th April 2018
This week was dominated by bearish movements across the majority of our observed wholesale contracts. Day-ahead gas fell 2.0% week-on-week to 49.0p/th (down from 50.0p/th). The same occurred across all other near-term and seasonal contracts. Near-term prices were influenced by falling demand, coupled with supplies supported from LNG deliveries. All seasonal gas contracts experienced bearish movements, falling 0.6% on average. Brent crude oil subsided 2.9% to average $67.7/bl. Bearish movements were driven by a range of factors during the week. Prices weakened by rising Russian production. After a long period of sustained growth, EU ETS carbon prices slipped 1.6% to average €13.0/t this week. Weak auction results throughout the week helped to drive prices downwards. Most near-term peak power contracts experienced growth across the week. Day-ahead peak power grew 2.3% to £52.2/MWh. In contrast to these trends some contracts underwent growth this week. After a recent bearish period, API 2 coal prices climbed this week, rising 2.5% to average $76.0/t. Growth was observed from the start of the week with the disruption to Australian coal supplies by cyclone Iris. Day-ahead power grew 2.4% to £49.9/MWh. Power prices were influenced by coal movements. However, gains were mitigated robust wind generation and high solar output at the end of the week. Seasonal baseload power prices rose this week, increasing on average by 0.8%.
Energy Wholesale Market Review Week Ending 6th April 2018
Written By Graham Paul
