Energy Wholesale Market Review
Energy Wholesale Market Review Week Ending 25th February 2022
This week has represented a significant upward shift in gas and power prices for near-term contracts as well as further along the forward curve, primarily in response to news surrounding the Russian invasion of Ukraine. Subsequently, day-ahead gas rose 50.0% to 255.00p/th, following the aforementioned news war has broken out in Ukraine, fuelling future gas supply concerns from Russia, which contributes a significant proportion of natural gas to the continent. Day-ahead power rose 72.0% to £227.00/MWh, taking direction from the bullish movements in gas contracts across the board, in what represents a relatively unprecedented political event in Europe. Subsequently, March 22 gas was up 51.1% at 259.66p/th, and April 22 gas increased 50.9% to 259.96p/th. Nearly all seasonal gas contracts boosted this week, up by 31.4% on average, with summer 22 and winter 22 gas increasing 49.9% and 46.6% respectively, lifting to 258.67p/th and 265.91p/th. Seasonal power contracts rose this week sharing similar growth to their seasonal gas counterparts, up on average by 28.0%. Summer 22 and winter 22 expanded 39.1% and 36.9% to £231.25/MWh and £245.00/MWh, respectively.
Wholesale price snapshot
Energy Wholesale Market Review Week Ending 25th February 2022.
Energy Wholesale Market Review Week Ending 18th February 2022
This week has seen the introduction of more bearish movements across most gas and power contracts, with more pronounced losses seen in near-term contracts while smaller losses were observed further along the forward curves. Day-ahead gas fell 4.1% to 170.00p/th, following periods of stronger Norwegian imports into GB, softening the general trend of tight gas supply margins this winter. Further pressure came from news that Russian-Ukranian tensions eased slightly, reducing future gas supply concerns. Day-ahead power followed lower, dropping 16.2% to £132.0MWh, exacerbated by strong wind output as storms Dudley and Eunice swept across much of the UK. Furthermore, March 22 gas was down 4.8% at 171.84p/th, and April 22 gas decreased 4.2% to 172.31p/th. Most seasonal gas contracts declined this week too, down by 0.9% on average, with both summer 22 and winter 22 gas dropping 3.8% and 3.5% respectively, to 172.57p/th and 181.41p/th. Seasonal power contracts also declined this week, following their seasonal gas counterparts down. Seasonal power contracts fell on average by 2.1%, with summer 22 power lowering 3.4% to £166.20/MWh.
Wholesale price snapshot
Energy Wholesale Market Review Week Ending 18th February 2022.
Energy Wholesale Market Review Week Ending 11th February 2022
All gas contracts moved lower this week, with the majority of power contracts following suit. Day-ahead gas lost 5.7% to 177.20p/th, amid strong flows from Norway and forecasts of lower gas-for-power demand early next week. March 22 gas dropped 8.0% to 180.46p/th, while the April 22 contract fell 7.7% to 179.82p/th. Further along the curve, summer 22 gas decreased 8.0% to 179.31p/th and winter 22 gas declined 7.2% to 187.31p/th. Day-ahead power dropped 6.3% to £157.50/MWh, weighed on by lower gas prices and forecasts of strong wind generation on Monday. Month-ahead power fell 6.8% to £170.00/MWh and April 22 power lost 6.9% to £175.00/MWh. Meanwhile, summer 22 power slipped 6.4% to £172.00/MWh and the winter 22 contract decreased 7.2% to £181.00/MWh. All tracked international commodity prices increased this week. Brent crude oil lifted 1.4% to average $91.31/bl, supported by a surprise drawdown in US crude stocks and reports of a tight global market.
Wholesale price snapshot
Energy Wholesale Market Review Week Ending 11th February 2022.
Energy Wholesale Market Review Week Ending 4th February 2022
This week was saw a largely bearish sentiment across GB gas and power contracts. The most pronounced week-on-week losses were obserbed in near-term contracts, due to easing pressures on system fundamentals in the week. Subsequently, day-ahead gas fell 14.2% to 188.00p/th, following periods of stronger Norwegian imports and increased LNG cargo deliveries to the UK, softening the ongoing tight gas supply landscape. Day-ahead power fell too, down 7.2% to £168.00/MWh, mirroring the largely bearish direction of near-term gas contracts. This was exacerbated by periods of stronger wind generation in tandem. As a result, March 22 gas was down 12.0% at 196.24p/th, and April 22 gas decreased 9.7% to 194.78p/th. Most seasonal gas contracts declined this week, down by 2.8% on average. Both summer 22 and winter 22 gas dropped 9.4% and 9.6% respectively, subsiding to 194.85p/th and 202.53p/th. On the contrary, most seasonal power contracts boosted this week, up on average by 3.7%, as summer 22 power increased 6.7% to £183.75/MWh, and winter 23 lifted 5.9% to £125.00/MWh.
Wholesale price snapshot
Energy Wholesale Market Review Week Ending 4th February 2022.
Written By Graham Paul
