Energy Wholesale Market Review, 26 February 2021

Headlines

It was a relatively bearish week again for gas and power contracts this week, with the exception of the day-ahead power contract and near-term peak power. Day-ahead power rose 14.7% to £65.95/MWh, with forecasts of notably reduced wind generation expected next week. Alternatively, Day-ahead gas fell 6.5% to 40.90p/th, following the system being oversupplied for the majority of the week. March 21 gas was down 9.2% at 39.72p/th, and April 21 gas decreased 11.2% to 38.05p/th. All seasonal gas contracts declined this week, down by 2.6% on average, with summer 21 and winter 21 gas falling 6.1% and 3.6% respectively, subsiding to 38.64p/th and 48.65p/th. Most seasonal power contracts followed the same downward, falling on average by 1.2%, with summer 21 power declining 3.6% to £50.00/MWh, while winter 21 lost 1.5% to £58.88/MWh. Brent crude oil rose again this week, up 3.2% to average $65.67/bl. Brent crude broke 12-months highs again this week, climbing to a peak of $67.20/bl on 25 February. The Brent crude market continues to prosper in the wake of the ongoing global vaccination roll-out. Similarly, easing lockdown restrictions across some major economies and positive economic forecasts for recovery all acted to support prices this week. EU ETS carbon prices fell this week, declining 2.6% to average €38.04/t. The EUA December 21 contract closed below the anticipated bullish forecasts, sending a relatively bearish signal across the market.

Baseload electricity
  • Day-ahead power rose 14.7% to £65.95/MWh, following forecasts of notable reductions in wind generation expected next week.
  • March 21 power slipped 3.1% at £53/MWh and April 21 power decreased 2.8% to £52.75/MWh.
  • Q221 power moved 3.5% lower to £50.32/MWh.
  • The annual April 21 contract lost 2.5% to £54.44/MWh, 29.2% higher than the same time last year (£42.13/MWh).

Forward curve comparison

Baseload electricity Forward curve comparison 26 February 2021

Annual April Contract

Baseload electricity Annual April contract 26 February 2021

Peak electricity
  • Day-ahead peak power was up 23.6% to £78.50/MWh, following its baseload counterpart higher.
  • March 21 peak power gained 0.5% at £61.03/MWh, and April 21 peak power decreased 1.8% to £55.6/MWh.
  • The annual April 21 peak power lost 1.2% to £61.59/MWh.
  • This is 28.6% lower than the same time last year (47.88/MWh).

Forward curve comparison

Peak electricity Forward curve comparison 26 February 2021

Annual April contract

Peak electricity Annual April contract 26 February 2021

Seasonal power prices

Seasonal baseload power contracts

Seasonal power prices Seasonal baseload power contracts 26 February 2021

Seasonal baseload power curve

Seasonal power prices Seasonal baseload power curve 26 February 2021

  • Most seasonal power contracts declined this week, down on average by 1.2%.
  • Summer 21 power decreased 3.6% to £50.00/MWh, while winter 21 fell 1.5% to £58.88/MWh.
  • Most seasonal peak power contracts declined this week, down 0.7% on average.
  • Summer 21 and winter 21 peak power dropped 2.3% and 0.3% respectively, falling to £54.74/MWh and £68.44/MWh.
Commodity price movements

Oil and Coal

Commodity price movements Oil and Coal 26 February 2021

Carbon

Commodity price movements Carbon 26 February 2021

  • Brent crude oil rose again this week, up 3.2% to average $65.67/bl this week.
  • Brent crude broke 12-months highs again this week. Prices climbed to a peak of $67.20/bl on 25 February.
  • The Brent crude market continues to prosper in the wake of the ongoing global vaccination roll-out. Similarly, easing lockdown restrictions across some major economies and positive economic forecasts for recovery all acted to support prices this week.
  • API 2 coal rose 4.3% from the previous week to average $67.57/t.
  • EU ETS carbon prices fell this week, declining 2.6% to average €38.04/t.
  • Prices floundered this week, weighed on by wider market movements.
  • The EUA December 21 contract closed below the anticipated bullish forecasts anticipated, sending a relatively bearish signal across the market.
  • However, colder weather expected across Europe next week acted to offset any further substantial losses.
Wholesale price snapshot 

Wholesale price snapshot 26 February 2021

Posted by TEAM on 26 February 2021
  • Wholesale Market

    • 2021 (30)
    • +2020 (51)
    • +2019 (50)
    • +2018 (17)
  • Blog & News Archive

    • 2021 (44)
    • +2020 (84)
    • +2019 (87)
    • +2018 (59)
    • +2017 (32)
    • +2016 (33)
    • +2015 (57)
    • +2014 (26)
    • +2013 (13)
    • +2012 (8)
    • +2010 (1)