Energy Wholesale Market Review
Energy Wholesale Market Review Week Ending 28th June 2019
The majority of wholesale power and gas contracts fell week-on-week, as above seasonal normal temperatures caused by winds from the Sahara, led to weaker demand for gas, whilst power prices were pressured by an uptick in wind generation. Amid the record-breaking temperatures, day-ahead gas dropped to a two-year low of 25.2p/th on 26 June, whilst winter 19 gas was 2.1% lower, ending the week at 49.8p/th, the first time the contract has been below 50p/th since April 2018. Most power contracts followed their gas counterparts lower despite a 5.9% increase in EU ETS carbon prices. The day-ahead contract was 5.0% lower at £36.1/MWh, a near one-month low. On average, seasonal baseload power contracts were up 0.7% week-on-week, with both summer 20 and winter 20 rising by 0.8% to end the week at £48.4/MWh and £56.1/MWh, respectively. Brent crude oil rose for a fourth consecutive week, up by 5.2% to average $65.7/bl, supported by expectations that OPEC will agree to extend current production cuts into H219 at its meeting on 1-2 July and optimism over US-China trade talks at the G20 summit in Japan. API 2 coal prices reversed recent downward movements, up 1.9% to average $64.3/t. EU ETS carbon prices recovered further last week, rising 5.9% to average €26.5/t. EUAs peaked at €27.5/t on 26 June, a fresh two-month high and approaching April’s 11-year high of €27.8/t.
Energy Wholesale Market Review Week Ending 28th June 2019
Energy Wholesale Market Review Week Ending 21st June 2019
Baseload power contracts up to and including winter 19 power were down week-on-week, whilst contracts beyond this rose. Power prices mirrored their gas counterparts as warmer temperatures are expected next week. The day-ahead contract was 3.2% lower at £38.0/MWh, a fresh two-week low. Q319 power decreased 3.1% week-on-week to £39.4/MWh. This is the first time a front-quarter baseload power contract has gone below £40.0/MWh since Q317 power in June 2017. On average, seasonal baseload power contracts were up 0.3% week-on-week, with all contracts mirroring their gas counterparts. All gas contracts up to and including winter 19 were lower week-on-week. Gas prices were pressured by forecasts of temperatures well above seasonal normal levels, and the expectation of comfortable gas supplies. Day-ahead gas was down 5.2% to end the week at 26.3p/th, the lowest since level September 2016. On average, seasonal contracts were 0.4% higher, supported by a recovery in Brent crude oil prices. Brent crude oil prices rose for a second consecutive week, up by 1.0% to average $62.4/bl. Prices were supported by growing tensions between Iran and the US, following news that Iran shot down a US military drone. API 2 coal prices slipped 1.7%, averaging $63.1/t. EU ETS carbon prices edged 0.3% higher to average €25.1/t. This was despite pressure following an increase in the number of auctions which took place compared to the previous week, boosting the supply of EUAs.
Energy Wholesale Market Review Week Ending 21st June 2019.
Energy Wholesale Market Review Week Ending 14th June 2019
The majority of baseload power contracts fell week-on-week, with near-term contracts up to and including August 19 power unchanged. The day-ahead contract was unchanged week-on-week at £39.3/MWh, having risen to a two-week high of £40.5/MWh on 11 June as low wind generation was expected the following day. All seasonal power contracts moved lower, falling 0.3% on average. Winter 19 power declined 0.5% to £55.4/MWh at the end of the week, having started the week at £56.9/MWh. All gas contracts moved lower week-on-week, amid comfortable gas supplies and forecasts of warmer temperatures easing expected LDZ demand. Day-ahead gas was 3.0% lower at 27.7p/th, having peaked at 30.0p/th on 13 June as temperatures were forecast to remain well below seasonal normal the following day. Seasonal contracts fell 1.3% on average, with winter 19 gas 1.3% lower week-on-week at 51.3p/th. Brent crude oil rose for the first time in four weeks, up by only 0.3% to average $61.8/bl, supported by reports of attacks on two oil tankers in the Gulf of Oman. API 2 coal prices were unchanged this week, averaging $64.2/t. Demand for coal in Europe remains relatively low, with total coal imports into Europe at 49mt between January-May, down 10% year-on-year. EU ETS carbon prices reversed the previous week’s decline, lifting 3.3% to average €25.0/t, supported by a drop in auction volumes this week following a public holiday on Monday, and a lack of a bi-weekly Polish auction on Wednesday.
Energy Wholesale Market Review Week Ending 14th June 2019
Energy Wholesale Market Review Week Ending 7th June 2019
The majority of baseload power contracts fell week-on-week, with only day-ahead power rising. The contract gained 10.3% week-on-week to £39.3/MWh, following its gas counterpart higher amid cooler temperatures and low wind generation. All seasonal power contracts moved lower, falling 1.0% on average. Winter 19 power declined 1.4% to £55.8/MWh at the end of the week, having dropped to a two-month on 5 June. Gas contracts experienced mixed movements this week, as cooler weather supported near-term contracts up to and including August 19, whilst contracts further along the curved followed oil prices lower. Day-ahead gas rose 3.8% to end the week at 28.6p/th, having dropped to 26.9p/th on 4 June as the system was oversupplied. Month-ahead gas was up 3.3% to 28.4p/th, despite warmer temperatures forecast in July. Seasonal contracts fell 1.0% on average, with winter 19 gas 1.9% lower week-on-week at 52.0p/th. Brent crude oil fell 9.7% to average $61.6/bl, following news of an unexpected rise in US crude stockpiles at the end of May, pushing prices below $60/bl on 5 June, the lowest since January. Oil prices were also pressured by news that US crude production hit a record 12.4mn bpd at the end of May. API 2 coal prices fell again, down 2.9% to average $64.2/t. Prices dropped to $63.3/t, a fresh two-year low, as ARA coal stocks remained well supplied at 6.6mt as of 3 June. EU ETS carbon prices dropped 4.5% to average €24.2/t.
Energy Wholesale Market Review Week Ending 7th June 2019
Written By Graham Paul
