Energy Wholesale Market Review
Energy Wholesale Market Review Week Ending 29th January 2021
This week has seen mixed price movements, with prices leaning towards bearish. Day-ahead gas fell 3.3% to 59.00p/th, afflicted by periods of warmer weather, particularly at the week’s start. Day-ahead power fell 28.5% to £71.5/MWh, with increased wind generation experienced for large parts of the week, coupled with reduced demand in parallel and the new IFA2 1GW interconnector coming online. February 21 gas was down 8.5% at 54.84p/th, and March 21 gas decreased 16.1% to 47.52p/th. Most seasonal gas contracts declined last week, down by 0.9% on average, while summer 21 and winter 21 gas dropped 1.4% and 1.1% respectively, to 43.57p/th and 51.67p/th. Most seasonal power contracts declined this week, down on average by 0.4%, as summer 21 power decreased 0.9% to £52.50/MWh and winter 21 fell 0.6% to £58.65/MWh. Brent crude oil marginally reversed last week’s decline, lifting 0.8% to $55.93/bl this week. Despite prices rising, the general sentiment in the market remains cautious. Global lockdowns across many major economies continues, with little sign of easing in the coming weeks. Vaccination roll-out continues to provide some assurance to markets, providing support to prices. EU ETS carbon rose 1.6% to average €33.48/t. Like other commodity markets, news of high global case numbers of COVID-19 continues to act bearishly on the carbon price. On 29 January, the return of EUA auctions acted to push prices lower with increased supply volumes.
Energy Wholesale Market Review Week Ending 29th January 2021
Energy Wholesale Market Review Week Ending 22nd January 2021
It has been a largely bullish week for gas and power price contracts, with exceptions coming from longer dated contracts. Day-ahead gas rose 1.7% to 61.00p/th, following forecasts of near-zero temperatures forecast early next week and periods of increased demand expected. Day-ahead power rose 52.9% to £100.00/MWh, following a notable drop off in wind generation at the end of the week and greater demand forecast at the start of next week. February 21 gas was up 0.2% at 59.92p/th, and March 21 gas increased 6.4% to 56.64p/th. Most seasonal gas contracts rose this week, up by 3.7% on average, while summer 21 and winter 21 gas increased 7.1% and 5.4% respectively, lifting to 44.20p/th and 52.23p/th. Most seasonal power contracts gained this week, up on average by 1.2%, as summer 21 and winter 21 rose 4.1% and 2.7%, to £53.00/MWh and £59.00/MWh, respectively. Brent crude oil slipped marginally to $55.48/bl this week. Prices were afflicted this week by news of COVID-19 case rising globally, despite the roll-out of several different vaccinations. As case numbers have rapidly spiralled again in recent weeks, it has led to many economies entering tougher phases of lockdown restrictions once again to combat the spread of the virus. EU ETS carbon felt this week, slipping 2.8% to average €32.96/t. Like other commodity markets, news of a resurgence in global case numbers of COVID-19 has acted bearishly on prices.
Energy Wholesale Market Review Week Ending 22nd January 2021
Energy Wholesale Market Review Week Ending 15th January 2021
This week has seen mixed pricing fundamentals for both gas and power contracts. Day-ahead gas fell 2.8% to 60.00p/th, with temperatures increasing slightly towards seasonal normal levels, as well as periods of system oversupply. Day-ahead power fell 4.2% to £65.4/MWh, despite strong gains made throughout the week with tight supply margins and low levels of wind output. Friday 15 January saw a substantial decline in the day-ahead price amid strong renewable generation and reduced demand forecasts. February 21 gas was down 1.7% at 59.78p/th, and March 21 gas decreased 4.3% to 53.25p/th. Most seasonal gas contracts declined last week, down by 2.3% on average. Summer 21 and winter 21 gas dropped 5.3% and 3.7% respectively, subsiding to 41.28p/th and 49.57p/th. All seasonal power contracts declined this week, down on average by 3.0%, as summer 21 power decreased 4.3% to £50.90/MWh, while winter 21 fell 2.6% to £57.44/MWh. Brent crude oil continued its recent bullish trends this week, lifting 4.7% from the week prior to $55.97/bl. Prices reached their highest level since the beginning of February 2020 at $56.69/bl on 13 January. EU ETS carbon remained virtually static last week, to average €33.89/t. Carbon markets continue to prosper in the news of climate targets made by the EU and the potential opportunities of the new UK ETS, with auctions set to take place no later than Q221.
Energy Wholesale Market Review Week Ending 15th January 2021.
Energy Wholesale Market Review Week Ending 8th January 2021
Most power and gas contracts continue to follow bullish trends as observed prior to the Christmas break. Day-ahead power rose 6.6% to £68.25/MWh, finding support from tight supply margins, amid periods of low generation availability and high demand, with two Electricity Margin Notice (EMN) issued in the week on Wednesday and Friday. Day-ahead gas rose 8.3% to 61.75p/th, benefitting from the continued period of colder weather across the UK and much of North-West Europe, although this is set to subside next week. February 21 gas was up 7.2% at 60.82p/th, and March 21 gas increased 6.0% to 55.64p/th. Most seasonal gas contracts rose last week, up by 0.7% on average, with summer 21 and winter 21 gas increasing 2.6% and 2.3% respectively, lifting to 43.59p/th and 51.49p/th. Most seasonal power contracts also saw growth, rising by 1.7%, as summer 21 and winter 21 expanded 2.6% and 2.6% respectively, to £53.16/MWh and £59.00/MWh. Brent crude oil resumed gains last week, averaging $53.45/bl last week. Prices reached a near 11-month high on Friday at $54.74/bl. The Brent crude price lifted on supply cut pledges from Saudi Arabia, to combat market oversupply and demand concerns. EU ETS carbon climbed for the eighth consecutive week, rising 4.1% to average €34.02/t last week. Carbon prices were almost 17% higher than the same time last month. Prices on 8 January reached a new all-time high at €34.83/t. Prices continued to find support from ambitious climate targets made by the EU with a tighter carbon market expected as a result.
Energy Wholesale Market Review Week Ending 8th January 2021.
Written By Graham Paul
