Energy Wholesale Market Review
Energy Wholesale Market Review Week Ending 29th April 2022
This week, the majority of gas and power contracts reported losses, despite news that Bulgaria and Poland saw gas supplies from Russia cut off on Wednesday, prompting notable bullish price movement mid-week. Day ahead gas dropped 20.9% to 125.00p/th, weighed on by system oversupply following a reduction in exports to Europe, amid maintenance at the IUK interconnector. Following wider movements in global commodity markets, further along the forward curve June 22 gas traded 26.2% lower at 155.05p/th, while summer 23 gas lost 13.4% to 170.50p/th. All power contracts went down last week with the exception of day-ahead power, which was unchanged at £160.00/MWh. The day-ahead power contract remained varied during the week amid forecasts of reduced wind output, but ultimately followed movements in its gas counterpart, peaking at £190.00/MWh on Wednesday. Q322 power slipped 10.6% to £195.00/MWh, summer 23 power reduced 7.9% to £163.00/MWh, and winter 23 power went down 6.6% to £170.00/MWh. EU ETS carbon dropped 2.6% to average €82.65/t, while UK ETS carbon went up 4.0% to average £81.24/t, finding support from lower renewables output this week.
Wholesale price snapshot
Energy Wholesale Market Review Week Ending 29th April 2022.
Energy Wholesale Market Review Week Ending 22nd April 2022
Near-term gas and power contracts moved lower this week, while most seasonal contracts continued to increase. Day-ahead gas dropped 11.2% to 158.00p/th, with warmer temperatures leading to reduced demand towards the end of the week. Month-ahead gas lost 7.2% to 185.16p/th and June 22 gas slipped 4.1% to 209.97p/th. Seasonal gas contracts rose 3.8% on average. The winter 22 contract was the only contract to move lower week-on-week, declining 2.8% to 243.36p/th, while summer 23 gas gained 4.4% to 196.85p/th. Power prices followed their gas counterparts closely, with day-ahead power losing 5.9% to £160.00/MWh. May 22 power dropped 3.2% to £181.00/MWh and the June 22 contract slipped 1.0% to £200.00/MWh. All seasonal power contracts increased this week, rising 7.8% on average. Winter 22 power edged 0.1% higher to £229.16/MWh and summer 23 power climbed 6.6% to £177.00/MWh. Brent crude oil gained 4.5% to average $108.66/bl, despite concerns of weaker global growth and wavering demand due to further Covid lockdowns in China. EU ETS carbon jumped 9.9% to average €84.83/t, while UK ETS gained 1.2% to average £78.13/t.7
Wholesale price snapshot
Energy Wholesale Market Review Week Ending 22nd April 2022.
Energy Wholesale Market Review Week Ending 14th April 2022
Continuing last week’s trend, all near-term gas and power contracts saw losses this week, while the majority of seasonal contracts reported gains. Day-ahead gas fell 25.5% to 178.00p/th, weighed by system oversupply in the week, amid soft heating demand and stronger LNG sendout. May 22 gas was down 17.6% at 199.51p/th, and Q322 gas moved 9.8% lower to 233.88p/th. Seasonal gas prices remain sensitive to geopolitical developments, supported by continued concerns over future Russian gas supply. As a result, most seasonal gas contracts boosted last week, up by 5.8% on average. Winter 22 gas dropped 3.7% to 249.60p/th, while summer 23 gas increased 14.2% to 188.50p/th. Day-ahead power fell 15.0% to £170.00/MWh, weighed on by bearish gas prices and forecasts of soft demand over the Easter Bank Holiday. June 22 power decreased 9.0% to £202.00/MWh and Q322 power moved 8.3% lower to £218.21/MWh. Most seasonal power contracts went up last week, up on average by 7.3%, following seasonal gas contracts higher. Summer 23 grew 8.9% to £166.00/MWh and winter 23 rose 11.1% to £170.00/MWh.
Wholesale price snapshot
Energy Wholesale Market Review Week Ending 14th April 2022
Energy Wholesale Market Review Week Ending 8th April 2022
The majority of gas and power contracts retreated week-on-week, with the predominant bearish movements seen across near-term contracts, but with gains seen further out on the forward curve – a potential consequence of risk premimums being baked into longer-dated contracts as global wholesale energy supply disruption concerns continue in the wake of the war in Ukraine. Furthermore, day-ahead gas fell 19.8% to 239.00p/th, indicative of the on-going volatility across the wholesale gas landscape, with specific bearish drivers this week including periods of system oversupply. Day-ahead power declined 18.4% to £200.00/MWh, mirroring bearish trends set from its gas counterpart contract. These bearish fundamentals filtered into front-month contracts too, with May 22 gas down 18.8% at 242.11p/th, and June 22 gas decreased 16.9% to 250.80p/th. However, most seasonal gas contracts boosted this week, up by 31.5% on average, while winter 22 gas dropped 14.4% to 254.65p/th, while summer 23 gas increased 79.5% to 268.10p/th. In a similar vain, seasonal power contracts saw gains this week, up on average by 7.5%, as winter 22 power decreased 8.5% to £238.00/MWh, while summer 23 expanded 8.9% to £152.50/MWh.
Energy Wholesale Market Review Week Ending 8th April 2022
Energy Wholesale Market Review Week Ending 1st April 2022
The majority of power and gas contracts increased this week. Day-ahead gas climbed 16.0% to 298.00p/th, supported by colder temperatures and an undersupplied gas system towards the end of the week. The new month-ahead contract (May 2022) gained 11.3% to 298.23p/th and June 2022 gas jumped 23.4% to 301.93p/th. Seasonal gas contracts moved 2.7% higher on average. Winter 22 gas saw the greatest movements, rising 11.8% to 297.50p/th. In contrast, summer 23 gas lost 4.8% to 149.40p/th. Day-ahead power surged 21.9% to £245.00/MWh, driven higher by rising gas prices and decreasing wind generation. Month-ahead power lifted 7.1% to £249.00/MWh and June 22 power leapt 19.2% to £253.00/MWh. Seasonal power contracts climbed 8.9% on average, with summer 22 power jumping 16.6% to £260.00/MWh. Meanwhile, summer 23 power rose 3.7% to £140.00/MWh. Brent crude oil fell 4.9% to average $111.04/bl, pressured by the potential release of oil from the US Strategic Reserve and rising OPEC+ supply. EU ETS carbon lifted 0.3% to average €79.24/t, while UK ETS slipped 1.1% to average £76.35/t.
Wholesale price snapshot
Energy Wholesale Market Review Week Ending 1st April 2022.
Written By Graham Paul
