Wholesale gas and electricity prices gave up the reductions of Wednesday during Thursday’s trade. We expect this volatility to continue, albeit with a downward momentum.
On the generation front, renewables were still well over 50% in the past week with fossil fuels just 16% of UK generation.
| Gas: Gas prices rose yesterday despite bearish fundamentals. In the prompt, the UK expects to receive two LNG cargoes by the end of June, pushing LNG inventories to 84%. The increased wind generation brings cooler temperatures, which could spur an increase in demand for gas-fired generation. Curve prices were pulled higher by bullish European prices, as the EU ETS influenced German gas curve products. Power: Power prices strengthened across all contracts yesterday, despite the well above average wind generation in the prompt. Prices were influenced by the wider energy complex and the gains across European gas prices. Oil: Oil prices rose yesterday. Reports of the China and US presidents having spoken via phone has pushed oil prices upwards, despite any clarity on what was discussed. The market has reacted positively, expecting a rise in demand for oil if an agreement is made between the two nations. Carbon (EU ETS): The ICE Dec-25 closed at €72.74/t yesterday. The contract opened at €73.1/t this morning and is currently trading at €72.69/t. Carbon (UKAs): The ICE Dec-25 finished yesterday’s session at £50.50/t. This morning it’s currently trading down at £50.19/t. |
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