Energy Wholesale Market Review
Energy Wholesale Market Review Week Ending 30th November 2018
This week, the majority of wholesale power and gas prices fell, whilst commodities experienced mixed movements. Prompt wholesale power and gas contracts moved lower, driven by high levels of wind generation and an oversupplied gas system. All baseload power contracts fell this week. The day-ahead contract plummeted 9.7% to £60.5/MWh. High levels of wind generation pressured day-ahead prices throughout the week with output from transmission connected windfarms exceeding 12GW for the first time on Wednesday. All seasonal baseload power contracts decreased week-on-week, down 0.9% on average. Summer 19 power decreased 0.8% to £56.2/MWh and the winter 19 contract slipped 1.0% to £61.9/MWh. All near-term gas contracts decreased this week, with just the winter 20 and summer 21 contracts moving in the opposite direction. Day-ahead gas fell 7.1% to end the week at 62.6p/th. Near-term contracts continued to be pushed lower by high LNG send-out and the continuation of LNG deliveries into the UK. Most seasonal gas contracts also decreased, down 0.4% on average. Summer 19 gas dropped 1.0% to 55.7p/th and winter 19 gas was 1.2% lower at 63.9p/th. The weekly average Brent crude oil price fell for an eighth consecutive week, losing 6.3% to average $60.3/bl, pressured by oversupply concerns. API 2 coal prices rose 0.9% to average $84.5/t, supported by an increase in German coal-fired generation. EU ETS carbon prices were little changed, increasing 0.2% to average €19.9/t.
Energy Wholesale Market Review Week Ending 30th November 2018
Energy Wholesale Market Review Week Ending 23rd November 2018
This week, the majority of wholesale power and gas prices fell, following Brent crude oil and API 2 coal prices lower. Prompt wholesale power and gas contracts were pressured by revised temperature forecasts, which are higher than previously expected for the rest of 2018. Most baseload power contracts fell this week. The day-ahead contract slid 4.6% to £67.0/MWh. Wind generation is forecast to reach 10.0GW on 28 November, with the return of Heysham 2 nuclear plant on 24 November offering further supply security. Day-ahead gas dropped 3.9% to end the week at 67.3p/th. Prices were pressured by milder temperature forecasts and the gas system being oversupplied across the week amid high LNG send-out. The weekly average Brent crude oil price fell for a seventh consecutive week, down 5.3% to average $64.3/bl. Oil prices plummeted to $58.9/bl during the day on 23 November. This followed news earlier in the week that US crude stocks rose for a ninth consecutive week to their highest level since December 2017. API 2 coal prices dropped 4.6% to average $83.7/t, down from $87.8/t the previous week. Prices fell to $83.0/t on 21 November, the lowest since April as Chinese demand for the commodity continues to fall following the country’s decision to stop seaborne thermal coal imports until 2019. EU ETS carbon prices continued to recover, experiencing a third consecutively weekly rise. Prices were up 1.3% to average €19.9/t and ended the week above €21.0/t for the first time in seven weeks.
Energy Wholesale Market Review Week Ending 23rd November 2018
Energy Wholesale Market Review Week Ending 16th November 2018
All wholesale power and gas prices rose this week on the back of forecasts of below seasonal normal temperatures for the rest of 2018, whilst Brent crude oil and API 2 coal experienced downwards movements. The day-ahead power contract went up 14.7% to an eight-week high of £70.3/MWh, supported by falling levels of wind generation, projections of colder weather and higher gas prices. This is despite an increase in nuclear capacity supporting supply margins during periods of lower wind generation. Seasonal power contracts increased 2.5% on average. Summer and winter 19 went up 4.7% and 3.0% to £58.2/MWh and £63.7/MWh respectively. All gas contracts rose this week. Day-ahead gas gained 11.4% to end the week at an eight-week high of 70.0p/th. Prices were supported by falling temperature forecasts and an unplanned outage at Kollsnes gas terminal, despite the gas system being oversupplied across the week amid high LNG send-out. The weekly average Brent crude oil price fell for a sixth week, dropping 5.8% to average $67.9/bl. Oil prices dropped to a six-month low of $64.8/bl on 13 November, as recent concerns of a tight market have turned to worries of oversupply in 2019. API 2 coal prices dropped 2.8% to average $87.5/t, and hit a 16-week low of $86.0/t on 15 November as Chinese demand continues to drop. EU ETS carbon prices went up 7.9% to average €19.6/t. Prices broke €20.0/t at the start of the week, with support from reduced EUA auction volumes following the postponement of German auctions until Q119.
Energy Wholesale Market Review Week Ending 16th November 2018
Energy Wholesale Market Review Week Ending 9th November 2018
This week, wholesale power and gas prices rose, whilst Brent crude oil and API 2 coal experienced downwards movements. Despite day-ahead gas and power contracts hitting 12 and 14-week lows respectively, prices have been influenced by recovering EU ETS carbon prices and forecasts of below seasonal normal temperatures moving into December. All baseload power contracts along the curve rose this week with day-ahead power up 0.6% to £61.3/MWh. This was despite the contract falling to a 14-week low of £56.9/MWh on 6 November as higher wind generation was expected the following day. Power prices have followed gas prices higher week-on-week, with seasonal power contracts up 2.0% on average. Despite further LNG tankers arriving at UK terminals, day-ahead gas gained 2.2% to end the week at 62.9p/th. Prices had started the week at a 12-week low of 59.8p/th amid warmer temperatures but rose following an unplanned outage at Kollsnes gas plant on 8 November. The weekly average Brent crude oil price fell 4.6% to $72.1/bl, as oil prices dropped to a six-month low of $69.2/bl on 9 November. Recent concerns of a tight market have turned to worries of oversupply in 2019, and pressured prices. API 2 coal prices dropped 4.0% to average $90.3/t, as prices ended the week at $88.5/t, a 12-week low. EU ETS carbon prices went up 11.4% to average €18.2/t. Prices reached $19.9/t on 9 November, with the upcoming Market Stability Reserve in January 2019 expected to provide further support this year.
Energy Wholesale Market Review Week Ending 9th November 2018
Written By Graham Paul
