Energy Wholesale Market Review
Energy Wholesale Market Review Week Ending 30th September 2022
This week represented a relatively mixed picture for wholesale gas and power contracts. Primarily, we observed losses on shorter-dated contracts whereas prices further out on the forward curve recorded gains – a possible response to on-going concerns over future supply and associated disruption, amid gas leaks at both Nord Stream 1 and 2 pipelines in European territorial waters. Day-ahead gas fell 25.0% to 172.50p/th, amid a steady stream of LNG flows reaching UK LNG import terminals, softening the near-term supply/demand balance and assisting net injections into storage. However, day-ahead power rose 17.2% to £225.00/MWh, with periods of lower wind outturn seen during the week, tightening system margins slightly. October 22 gas was down 15.6% at 245.00p/th, and November 22 gas decreased 9.8% to 381.00p/th. Most tracked seasonal gas contracts boosted this week, up by 2.1% on average, while summer 23 gas increased 0.6% to 435.00p/th and and winter 23 gas rose 2.7% to 455p/th. Elsewhere, all seasonal power contracts rose this week, up on average by 3.0%, as winter 22 and summer 23 expanded 5.3% and 1.4% respectively, rising to £600.00/MWh and £350.00/MWh.
Wholesale price snapshot – Friday-on-Friday
Energy Wholesale Market Review Week Ending 30th September 2022.
Energy Wholesale Market Review Week Ending 23rd September 2022
This week, we observed the majority of wholesale gas and power contracts in GB retreat, in what continues to be a volatile period for wholesale energy prices, both in the UK as well as European markets. EU intervention on the current energy crisis continues to provide bearish sentiment for prices. As a result, day-ahead gas fell 11.5% to 230.00p/th, with some specific bearish drivers such as higher wind outturn seen at points during the week leading to reduced demand for gas-for-power generation. Some sentiment-based decline can also be put on the downward movement of prices, as the EU looks to tackle the on-going energy supply crisis. Day-ahead power fell 34.9% to £192.00/MWh, largely following the strong bearish movements of gas prices. October 22 gas was down 14.9% at 290.34p/th, and November 22 gas decreased 10.8% to 422.54p/th. Most seasonal gas contracts declined last week, down by 4.5% on average, as winter 22 and summer 23 gas dropped 6.1% and 3.6% respectively, subsiding to 481.00p/th and 432.55p/th. Some seasonal power contracts fell this week, but more significant rises in winter 22 and summer 24 prices week-on-week, tilted average prices to climb – up 3.9% on average.
Wholesale price snapshot – Friday-on-Friday
Energy Wholesale Market Review Week Ending 23rd September 2022.
Energy Wholesale Market Review Week Ending 16th September 2022
This week, we observed the continuation of downward price movements across most tracked wholesale gas and power contracts. EU intervention on the current energy crisis continues to provide bearish sentiment for prices. There were also some bearish pricing levers for GB specifically this week as follows. Subsqeuntly, day-ahead gas fell 24.6% to 260.00p/th, following system oversupply on multiple days, with steady flows of gas imports via our interconnectors and LNG deliveries in tandem. Day-ahead power fell 10.6% to £295.00/MWh, following its gas equivalent contract lower, coupled with periods of higher wind outturn seen at points during the week. Near-term bearish fundamentals influenced the price direction of contracts further out on the curve too. October 22 gas was down 14.7% at 341.04p/th, and November 22 gas decreased 4.7% to 473.73p/th. Most seasonal gas contracts declined this week, down by 4.0% on average, while both winter 22 and summer 23 gas dropped 2.4% and 4.9% respectively, subsiding to 512.45p/th and 448.70p/th. The majority seasonal power contracts declined this week too, down on average by 2.9%.
Wholesale price snapshot – Friday-on-Friday
Energy Wholesale Market Review Week Ending 16th September 2022.
Energy Wholesale Market Review Week Ending 9th September 2022
This week, we observed a relatively mixed picture for wholsale gas and power contracts – with day-ahead contracts registering gains but select front-month contracts and some further dated seasonal contracts retreating. Day-ahead gas rose 15.0% to 345.00p/th, following reports that Russia has suspended flows via Nord Stream 1 indefinitely and periods of lowering Norwegian gas exports during the week. Day-ahead power climbed 4.8% to £330.00/MWh, following gains set from its equivalent gas contract and periods of lower wind outturn in the week. However, October 22 gas was down 1.5% at 400.00p/th, and November 22 gas decreased 0.3% to 497.00p/th. Most of the tracked seasonal gas contracts increased this week, up by 2.6% on average. However, winter 22 gas dropped11.4% to 525.00p/th, whereas summer 23 gas lifted 10.3% to 472.00p/th. Unlike gas, the majority of seasonal power contracts declined this week, down on average by 2.2%, as winter 22 power decreased 12.7% to £550.00/MWh, while summer 23 expanded 1.5% to £340.00/MWh.
Wholesale price snapshot – Friday-on Friday
Energy Wholesale Market Review Week Ending 9th September 2022.
Energy Wholesale Market Review Week Ending 2nd September 2022
This week, we observed price decline across all tracked GB gas and power wholesale contracts, in what continues to be a volatile period of time for wholesale energy both in GB as well as continental Europe, with conflicting geopolitical price levers in the form of changes to Russian gas supplies, combined with the global economy being on the cusp of a recession. Day-ahead gas fell 45.0% to 300.00p/th, following the continuation of higher temperatures in the week and a steady influx of LNG, softening near-term supply/demand dynamics. Similarly, day-ahead power fell 37.0% to £315.00/MWh, linked to the strong downward movements of the equivalent gas contract and select periods of higher wind outturn seen in the week. Subsequently, October 22 gas was down 36.8% at 405.90p/th, and November 22 gas decreased 36.7% to 498.64p/th. Similar to near-term contracts, all seasonal gas contracts declined last week, down by 32.7% on average, while both winter 22 and summer 23 gas dropped 22.7% and 37.3% respectively, subsiding to 592.45p/th and 428.10p/th. Seasonal power contracts declined this week, down on average by 32.1%, as winter 22 power decreased 21.3% to £630.00/MWh, while summer 23 fell 38.5% to £335.00/MWh.
Wholesale price snapshot – Friday-on Friday
Energy Wholesale Market Review Week Ending 2nd September 2022.
Written By Graham Paul
