Energy Wholesale Market Review
Energy Wholesale Market Review Week Ending 24th April 2020
Most power and gas contracts fell again this week as lockdown measures continued to stifle both power and gas demand. Day-ahead gas fell 17.3% to 11.25p/th, with higher LNG send-out pressuring prices amid an oversupplied as market. Despite falling to a record low of £10.00/MWh early this week, day-ahead power opposed gas and ended the week up 15.1% at £25.60/MWh, due to forecasts of lower wind output early next week. May 20 gas was down 15.1% at 13.03p/th and June 20 gas decreased 15.2% to 13.73p/th. All seasonal gas contracts declined this week, down by 4.6% on average, while both winter 20 and summer 21 gas dropping 4.9% and 5.7% respectively, to 32.04p/th and 28.81p/th. All seasonal power contracts declined this week, down on average by 2.0%, as winter 20 power decreased 1.7% to £41.03/MWh, while summer 21 fell 2.2% to £36.39/MWh. Brent crude oil prices crashed again this week as WTI prices turned negative, sending the market into unknown territory. Brent crude prices lost 24.8% to average $21.89/bl, but on 22 April slid to a 21-year low under $16/bl. Prices stabilised late in the week as oil producers pledged to further output cuts. API 2 coal saw small losses last week, falling 1.1% to average $54.10/t, despite demand in China slowly regaining following the easing of lockdown restrictions. Whilst EU ETS carbon prices were impacted by oil price movements, they ultimately rose 2.4% to average €20.59/t. Carbon prices were supported by reduced nuclear power in France by EDF – resulting in a rise in fossil fuel imports and a greater demand for EUA’s.
Energy Wholesale Market Review Week Ending 24th April 2020
Energy Wholesale Market Review Week Ending 17th April 2020
Most power and gas contracts fell this week, though some small gains were seen in longer term power contracts. Day-ahead gas fell 12.0% to 13.60p/th on slightly milder temperatures forecast for next week, with oversupply of gas in the market continuing to rise. Day-ahead power fell 21.5% to £22.25/MWh, despite forecasts of lower wind early next week as the general decline in demand continued. May 20 gas was down 8.1% at 15.35p/th, and June 20 gas decreased 7.6% to 16.20p/th. All seasonal gas contracts declined this week, down by 0.7% on average, while both winter 20 and summer 21 gas dropped 0.1% and 0.5% respectively, subsiding to 33.70p/th and 30.55p/th. Seasonal power contracts were mixed, but moved down on average by 0.3%, as winter 20 power expanded 0.8% to £41.75/MWh, while summer 21 fell 1.6% to £37.20/MWh. Despite optimism early in the week that measures taken by OPEC and OPEC+ to cut global oil supply by 9.7mn bpd would support prices, Brent crude oil prices lost 12.2% to average $29.11/bl this week. There was sentiment in the market that the cuts to crude production would not be enough to outweigh falling demand for the commodity, currently decimated by the coronavirus. EU ETS carbon prices followed oil prices lower again, dropping 1.3% to average €20.11/t. Prices continue to follow oil and are also dependent on lockdown measures in EU countries. API 2 coal lost 1.4% to average $54.73/t this week.
Energy Wholesale Market Review Week Ending 17th April 2020
Energy Wholesale Market Review Week Ending 9th April 2020
Most power and gas contracts rose this week despite no change to lockdown measures announced in the UK. Day-ahead gas fell 3.4% to 15.45p/th on expectation of high temperatures and lowered demand over the Easter bank holiday. Day-ahead power opposed its day-ahead gas counterpart and rose 53.2% to £28.35/MWh. Recovering from an all-time low last week, the power contract rose on expectations of slightly lower wind generation next week. May 20 gas was up 3.3% at 16.70p/th, and June 20 gas increased 3.2% to 17.53p/th. All seasonal gas contracts boosted this week, up by 3.5% on average, while both winter 20 and summer 21 gas increased 3.3% and 5.0% to 33.73p/th and 30.70p/th, respectively. All seasonal power contracts climbed this week, up on average by 5.3%, as winter 20 and summer 21 5.9% and 8.0% to £41.43/MWh and £37.80/MWh, respectively. Brent crude oil gained 26.4% to average $33.16/bl this week, continuing momentum seen from the previous week, as the market looks tentatively to the next OPEC meeting, where a decision on possible cuts to oil supply could make or break the near-term future of oil supply. EU ETS carbon prices saw further recovery this week, mirroring gains seen in the oil market as the price of carbon rose 17.5% to average €20.37/t. API 2 coal followed oil and increased this week, rising 1.1% to average $55.49/t, as the effect of lowered demand begins to take effect on the coal market.
Energy Wholesale Market Review Week Ending 9th April 2020
Energy Wholesale Market Review Week Ending 3rd April 2020
Most power and gas contracts rose fell mixed this week, though a few rises were seen in future winter contracts. Day-ahead gas fell 16.0% to a fresh 10-year low of 16.00p/th on forecasts of decreasing consumption levels, and pushed lower by expectations of very mild weather next week. Day-ahead power fell 36.2% to a new all-time low of £18.50/MWh with falls the result of similar reasoning to that of gas. May 20 gas was down 11.7% at 16.17p/th, and June 20 gas decreased 8.9% to 16.99p/th. All seasonal gas contracts declined this week, down by 1.5% on average, while both winter 20 and summer 21 gas dropped 0.9% and 1.6% respectively, subsiding to 32.65p/th and 29.23p/th. Most seasonal power contracts boosted this week, up on average by 0.2%, as winter 20 power expanded 0.2% to £39.12/MWh, while summer 21 remained at £35.00/MWh. Brent crude oil fell by 2.1% to $26.23/bl over reports that US and Russia were looking to agree a deal to stabilise oil prices. Brent oil prices then reported their biggest daily gain on record on 2 April following the announcement by Donald Trump that Saudi Arabia and Russia could announce a major cut to oil production. EU ETS carbon gained by 6.2% to €17.33/t, reflecting the rise in the oil market. API 2 coal reversed gains seen in recent weeks, falling 4.5% to average $55.06/t, as the effect of lowered demand begins to take effect on the coal market.
Energy Wholesale Market Review Week Ending 3rd April 2020
Written By Graham Paul