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Energy Wholesale Market Review, 26 March 2021

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It was a largely bullish week for gas and power contracts, with some exceptions in day-ahead power and longer-term seasonal power contracts. As such, day-ahead power fell 24.9% to £47.75/MWh, with strong wind generation throughout periods of the week, coupled with wavering demand. Most seasonal power contracts declined this week, down on average by 0.4%, as summer 21 and winter 21 expanded 2.9% and 0.9% respectively, rising to £56.10/MWh and £64.90/MWh. April 21 gas was up 11.4% at 48.55p/th, and May 21 gas increased 10.2% to 46.00p/th. All seasonal gas contracts boosted this week, up by 3.8% on average, while both summer 21 and winter 21 gas increased 8.9% and 3.5% respectively, lifting to 46.10p/th and 54.50p/th. Brent crude oil prices slipped this week, down 6.4% to average $63.09/bl. Some price support stemmed from supply disruption, with a tanker beached on the Suez Canal impeding transit of other tankers. However, this was ultimately offset by Coronavirus case numbers rising in Europe, which has prompted demand concerns throughout the continent. EU ETS carbon prices fell this week, declining 2.9% to average €41.31/t. Losses on the Brent crude market fed through to carbon prices this week, albeit prices are still relatively buoyant compared against recent months. Similarly, EUA’s slipped on Thursday, primarily driven by coronavirus infection cases rising in Europe, fuelling demand concerns.

Baseload electricity
Day-ahead power fell 24.9% to £47.75/MWh, following periods of strong wind generation and wavering demand throughout the week. April 21 power climbed 3.1% at £57.2/MWh and May 21 power increased 3.5% to £55.45/MWh.		Q221 power moved 1.8% higher to £56.1/MWh. The annual April 21 contract rose 1.8% to £60.5/MWh, 54.7% higher than the same time last year (£39.1/MWh).
Forward curve comparison		Annual April Contract
Peak electricity
Day-ahead peak power was up 8.6% to £66.80/MWh, counteracting bearish trends from its baseload counterpart. April 21 peak power gained 1.1% at £59.96/MWh, and May 21 peak power increased 3.5% to £59.37/MWh.		The annual April 21 peak power lost 0.3% to £67.07/MWh. This is 48.7% lower than the same time last year (45.11/MWh).
Forward curve comparison		Annual April contract
Seasonal power prices
Seasonal baseload power contracts		Seasonal baseload power curve
Most seasonal power contracts declined this week, down on average by 0.4%. Summer 21 and winter 21 expanded 2.9% and 0.9% respectively, rising to £56.10/MWh and £64.90/MWh.		Most seasonal peak power contracts declined this week, down 0.2% on average. Summer 21 gas increased 1.3% to £59.90/MWh, while winter 21 peak power dropped 0.4% to £74.23/MWh.
Commodity price movements
Oil and Coal		Carbon
Brent crude oil prices slipped this week, down 6.4% to average $63.09/bl. Tanker transit disruption acted bullishly on Brent crude prices this week. On 23 March, a tanker sailing down the Suez Canal became ‘beached’, causing significant congestion for other vessels trying to pass. This ultimately led to notable supply disruption, supporting prices. Despite this supply disruption, prices were still weighed on heavily this week by news select countries in Europe continue to delay vaccine issuance amid concerns over side effects.		EU ETS carbon prices fell this week, declining 2.9% to average €41.31/t. Losses on the Brent crude market fed through to carbon prices this week, albeit prices are still relatively buoyant comparing against recent months. Similarly, EUA’s slipped on Thursday, primarily driven by coronavirus infection cases rising in Europe, fuelling demand concerns.
Wholesale price snapshot