Headlines
Wholesale gas contracts experienced bullish price movements last week, whereas all tracked power contracts, with day-ahead the exception, registered week-on-week price losses. Subsequently, day-ahead gas rose 1.6% to 116.30p/th, as an escalation of the war in Ukraine, including attacks on Ukrainian energy infrastructure, caused worries over gas supplies from Russia. However, stronger gains were limited by warmer average temperatures, decreasing gas demand for heating, in tandem with the announcement of a ceasefire between Israel and Hezbollah easing some concerns surrounding gas supplies. Similarly, day-ahead power rose 44.1% to £95.13/MWh, with upward price movement attributed, expectations of reduced wind generation on 2 December, gains across its gas counterpart, and various nuclear reactors remaining offline for maintenance across GB. Unlike the day-ahead baseload power contract, the front month contracts experienced bearish sentiment – with December 24 falling 2.9% to £92.50/MWh, and January 25 power decreasing 1.5% to £101.25/MWh. Similar downward price movements were seen across all seasonal power contracts, falling on average by 0.4%. Opposing this, all individual seasonal gas contracts increased last week, registering an overall gain of 1.1% on average. Both summer 25 and winter 25 gas rose 1.3% and 2.3% respectively, reaching 111.30p/th and 108.80p/th, with the summer 25 contract continuing to trade above the winter 25 contract.
Baseload electricity
Forward curve comparison
- Day-ahead power rose 44.1% to £95.13/MWh, due to expectations of lower wind generation on 2 December, alongside various nuclear reactors across GB remaining offline for maintenance, reducing the total available nuclear capacity to 44%
- However, December 24 power slipped 2.9% at £92.50/MWh and January 25 power decreased 1.5% to £101.25/MWh.
Annual October contract
- Q125 power moved 1.2% lower to £99.25/MWh.
- The annual April 25 contract lost 0.3% to £86.25/MWh, 9.4% lower than the same time last year (£95.25/MWh).
Peak electricity
Forward curve comparison
- Day-ahead peak power was down 8.6% to £104.25/MWh, opposing the notable gains seen across its baseload counterpart.
- December 24 peak power declined 2.7% to £108.75/MWh, whereas January 25 peak power rose 0.3% to £120.00/MWh.
Annual October contract
- The annual April 25 peak power fell 1.0% to £88.17/MWh
- This is 6.8% lower than the same time last year (94.60/MWh).
Seasonal power prices
Seasonal baseload power contracts
- All seasonal power contracts fell last week, down on average by 0.4%.
- Summer 25 power decreased 0.6% to £84.00/MWh, while winter 25 was unchanged at £88.50/MWh.
Seasonal peak power curve
- Likewise, all seasonal peak power contracts declined last week, down 1.0% on average.
- Summer 25 and winter 25 peak power dropped 2.2% and 0.5% respectively, falling to £88.50/MWh and £101.50/MWh.
Commodity price movements
Oil and coal
- Within the week, Brent crude oil observed downward price movements, compared to the bullish movements seen during the previous week, falling 0.6% to average $73.23/bl.
- Bearish movements were driven by the US brokering a ceasefire between Israel and Hezbollah, which acted to increase certainty around the supply of the commodity in the region.
- Price losses were limited though by US crude inventories falling by 1.8mn barrels across the week, compared to an expected 605,000-barrel decline.
- OPEC+ delayed its next policy meeting from 1 December to 5 December, where it is expected to decide on a further extension to production cuts which would place a bullish impact on prices.
- Business Monitor International reduced its forecast for the commodity from $78/bl in 2025 to $76/bl, noting an ongoing weakness in oil market sentiment and an increase in production expected under Trump’s administration.
Carbon (UK and EU ETS)
- Following higher wind outturn over the reporting period, and warmer temperatures acting to limit heating demand when compared to the levels seen previously, last week presented itself to be a bearish period for both UK and EU ETS carbon markets.
- EU ETS carbon prices fell 0.7% to €68.72/t and UK ETS carbon prices dropped 3.1% to £36.73/t.
- The price losses across the EU ETS follow ongoing volatility ahead of next month’s contract expiry, and reduced Dutch TTF gas prices providing a bearish sentiment for carbon prices and renewed selling during the settlement window
- However, prices remained relatively level week-on-week as the wider financial market is mixed as investors await euro zone inflation data.
- DESNZ published a press release on its consultation seeking input on a number of proposals to expand the UK Emissions Trading Scheme into the maritime sector. DESNZ stated that it will make changes to free allocation rules to ensure participants cannot benefit from surplus free allowances in their final year.
Wholesale price snapshot – Friday-on Friday
