Energy Wholesale Market Review, 8 November 2019

Headlines

Most power and gas contracts decreased this week, with day-ahead contracts the exceptions. Day-ahead gas rose 41.6% to finish the week at 40.0p/th, following a forecast drop in temperatures, while day-ahead power gained 13.1% to £44.4/MWh as wind generation dropped mid-week. December 19 gas was up 0.4% at 42.8p/th, and January 20 gas decreased 0.5% to 45.0p/th. All seasonal gas contracts declined this week, down 0.5% on average. Summer 20 gas dropped 0.9% to 39.3p/th and winter 20 gas declined 0.3% to 49.5p/th. All seasonal power contracts declined further this week, going down 0.7% on average. Summer 20 power fell 0.6% to end the week at £45.4/MWh, while the winter 20 contract slipped 0.5% to £52.8/MWh. Brent crude oil gained 2.2% to average $62.3/bl this week, following the shutdown of the Keystone pipeline after an oil spill. Delegates from OPEC this week have said that the organisation is more likely to encourage members to comply more fully with existing agreements to pledge to cut supplies by 1.2mn bpd. EU ETS carbon reversed last week’s gains, losing 1.4% to €25.2/t, amid weak auction results and waning German economic data. API 2 dropped 1.7% to average $64.1/t.

Baseload electricity
  • Day-ahead power rose 13.1% to £44.4/MWh as wind generation dropped mid-week.
  • December 19 power slipped 0.6% to £48.8/MWh while January 20 power fell 1.4% to £51.5/MWh.
  • Q120 power slipped 1.2% to £50.9/MWh.
  • The annual April 20 power contract lost 0.5% to £49.1/MWh, 9.2% lower than the same time last year (£54.1/MWh).

Forward curve comparison

Baseload electricity Forward curve comparison 8 November 2019

Annual October Contract

Baseload electricity Annual April contract 8 November 2019

 

Peak electricity
  • Day-ahead peak power reversed last week’s gains, rising 11.1% to £48.9/MWh, £4.5/MWh above its baseload counterpart.
  • December 19 peak power fell 1.3% to £54.7/MWh.
  • January 20 peak power decreased 1.2% to £58.7/MWh.
  • Annual April 20 peak power was 0.7% lower at £54.5/MWh, £5.4/MWh above its baseload power counterpart.
  • The contract is 10.7% below its value this time last year (£61.1/MWh).

Forward curve comparison

Peak electricity Forward curve comparison 8 November 2019

Annual October contract

Peak electricity Annual April contract 8 November 2019

Seasonal power prices

Seasonal baseload power contracts

Seasonal power prices Seasonal baseload power contracts 8 November 2019

Seasonal baseload power curve

Seasonal power prices Seasonal baseload power curve 8 November 2019

  • All seasonal power contracts declined further this week, going down 0.7% on average.
  • Summer 20 power fell 0.6% to £45.4/MWh, while the winter 20 slipped 0.5% to £52.8/MWh.
  • Seasonal peak power contracts were 4.7% lower on average.
  • Summer 20 peak power fell 0.6% to £49.1/MWh.
Commodity price movements

Oil and Coal

Commodity price movements Oil and Coal 8 November 2019

Carbon

Commodity price movements Carbon 8 November 2019

  • Brent crude oil gained 2.2% to average $62.3/bl this week.
  • Prices were supported by the shutdown of the Keystone pipeline following an oil spill.
  • Delegates from OPEC this week have said that the organisation is more likely to encourage members to comply more fully with existing agreements to pledge to cut supplies by 1.2mn bpd.
  • API 2 coal prices dropped a further 1.7% to $64.1/t, down 29.0% on the same time last year.
  • EU ETS carbon reversed last week’s gains, losing 1.4% to €25.2/t.
  • Weak auction results and waning German economic data weighed on prices.
  • However, losses were offset by reduced auction volumes in Poland.
    Carbon price plans for post-Brexit have been outlined, with a “UK ETS” system that is linked to the current EU ETS with similar environmental ambition being preferred. However, such a linkage will need to be ratified by EU member nations.
Wholesale price snaphot

 

Wholesale price snapshot 8 November 2019

Posted by TEAM on 11 November 2019
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