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Energy Wholesale Market Review


Energy Wholesale Market Review Week Ending 18th December 2020

The majority of power and gas contracts rose this week, in what has largely been a relatively bullish week for prices. However, some contracts reversed wider trends. Day-ahead gas represented one of the few contracts to decline this week, albeit marginally, slipping 0.1% to 42.50p/th, supported by periods of reduced temperature but ultimately offset by phases of notable system oversupply and wavering demand in parallel. Conversely, day-ahead power rose 10.5% to £49.9/MWh, supported by reduced wind generation at the start of the week coupled with increased demand. January 21 gas was up 2.5% at 45.79p/th, and February 21 gas increased 2.8% to 47.08p/th. Most seasonal gas contracts boosted this week, up by 1.1% on average, while both summer 21 and winter 21 gas increased 2.5% and 2.3% respectively, lifting to 36.80p/th and 45.38p/th. Most seasonal power contracts rose this week, up on average by 0.7%, as summer 21 and winter 21 expanded 1.7% and 1.1% respectively, rising to £47.30/MWh and £53.20/MWh. Brent crude oil climbed for the sixth consecutive week, lifting 3.3% higher to average $50.90/bl. Oil prices continued to rally on COVID-19 vaccination developments, creating a more positive demand outlook with more rapid economic recoveries predicted than previously. Oil prices also found support from reduced US crude inventories. EU ETS carbon climbed for the sixth consecutive week, rising 2.8% to average €30.86/t this week. Carbon prices are over 14% higher than the same time last month and over 20% higher than last year.

Energy Wholesale Market Review Week Ending 18th December 2020.


Energy Wholesale Market Review Week Ending 11th December 2020

Most power and gas contracts rose this week, with exceptions being in both day-ahead peak and baseload power contracts. Day-ahead gas rose marginally, lifting 0.1% to 42.55p/th, despite gradually increasing temperatures throughout the week, correlated with periods of system oversupply. Conversely, day-ahead power fell significantly, falling 59.0% to £45.15/MWh, reflecting a period of notably high prices from the week prior, following price spikes from tight supply margins and corelated low wind output. However the day-ahead baseload power contract was weighed upon by periods of increased wind generation and wavering demand throughout this week. All seasonal gas contracts rose this week, up by 4.4% on average, while both summer 21 and winter 21 gas increased 7.7% and 5.3% respectively, lifting to 35.91p/th and 44.37p/th. All seasonal power contracts boosted this week, up on average by 2.6%, as summer 21 and winter 21 expanded 4.6% and 3.5% respectively, rising to £46.50/MWh and £52.60/MWh. Brent crude oil climbed for the fifth consecutive week, lifting 2.7% higher from the previous week to average $49.26/bl. Oil prices continued to rally on COVID-19 vaccination developments, creating a more positive demand outlook whilst also supported by global equity markets. EU ETS carbon climbed for the fifth consecutive week in parallel, rising 2.8% to average €30.03/t this week. Prices broke the €30.00/t mark across 9th to 11th December.  Carbon prices benefitted largely from EU leaders reaching a deal on more ambitious and robust emissions cuts.

Energy Wholesale Market Review Week Ending 4th December 2020.


Energy Wholesale Market Review Week Ending 4th December 2020

In a bullish week for gas and power markets, all tracked contracts rose this week.  Day-ahead gas increased 2.7% to 42.50p/th, supported by periods of colder weather across GB and Continental Europe, set to continue into next week. Day-ahead power rose 115.3% to £110/MWh, following a sharp reduction in wind generation, coupled with higher demand forecast for next week, amid colder temperatures. Expectations of lower generation availability early next week further supported day-ahead power prices. January 21 gas was up 1.6% at 42.35p/th, and February 21 gas increased 4.6% to 42.92p/th. All seasonal gas contracts saw gains of 0.6% on average, while both summer 21 and winter 21 gas increased 0.5% and 0.3% respectively, lifting to 33.35p/th and 42.13p/th. All seasonal power contracts boosted this week, up on average by 2.0%, as summer 21 and winter 21 expanded 2.0% and 1.4% respectively, rising to £44.46/MWh and £50.80/MWh. Brent crude oil climbed for the fourth consecutive week, lifting 1.5% higher from the week prior to average $47.97/bl. Prices reached $49.23/bl on Friday 4 December, its highest price since the beginning of March. Oil prices continued to rally on COVID-19 vaccination developments, creating a more positive demand outlook, coupled with improving global equity markets. EU ETS carbon climbed for the fourth consecutive week, rising 5.7% to average €29.22/t this week. Prices reached a three-month high of €29.89/t on 4 December.

Energy Wholesale Market Review Week Ending 4th December 2020

Written By Graham Paul

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