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Energy Wholesale Market Review

Energy Wholesale Market Review Week Ending 31st May 2019

All wholesale power and gas contracts fell week-on-week. Gas prices have been pressured by forecasts of warmer weather amid comfortable gas supplies, which, combined with a drop in Brent crude oil prices, pushed both day-ahead and winter 19 gas contracts to one-month lows of 27.5p/th and 53.0p/th respectively. Month-ahead gas was down 6.7% to 28.2p/th, as above seasonal normal temperatures are forecast throughout most of June. Baseload power contracts mirrored their gas counterparts, as day-ahead power fell 3.8% week-on-week to a near two-year low of £35.6/MWh, pressured by lower gas prices and decreasing summer power demand. Month-ahead power lost 4.6%, ending the week at £39.1/MWh. All seasonal power contracts moved lower, falling 1.1% on average. Winter 19 power declined 2.1% to £56.6/MWh, a near one-month low. Brent crude oil fell for the second consecutive week, dropping 3.9% to average $68.2/bl. Oil prices dropped to $64.9/bl on 31 May, the lowest since mid-February. Prices have been pressured by the ongoing US-China trade war, which continued to offset concerns of tighter global supplies. API 2 coal prices fell 2.8% to average $66.1/t, having ended the week at two-year low of $65.4/t. API 2 coal prices have been pressured by weak demand in Europe, as higher gas storage levels in NW Europe and downwards movements in European hub gas prices continue to push coal-fired generation out of the power mix. EU ETS carbon prices were up 1.2% to average €25.3/t.

Energy Wholesale Market Review Week Ending 31st May 2019.

Written By Graham Paul


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