The market is currently well-supplied and is expected to remain that way in the next few days while consumption levels are also lower. Near-term prices made losses as a result of the weak spot market over the weekend while CO2 prices were strong at the start of the session.
How did the energy markets close?
Gas contract prices reduced as the system was well-supplied for the majority of yesterday's session and strong Brent prices were ignored. Front-Month and Front-Quarter contracts made the biggest losses which ranged between 0.70ppt and 1.05ppt. Day-Ahead also dropped slightly and made a loss of 0.15ppt as healthy supply was countered by a number of sites going offline. Further along the curve, seasonal contracts made losses ranging between 0.40ppt and 0.70ppt. The power curve also saw losses except Day-Ahead which gained £0.60/MWh while August-13 registered the largest price drop of £1.25/MWh. The price increase for Day-Ahead was a result of reduced wind production at peak times on Monday.
How did the energy markets open?
Day-Ahead gas made a loss of 1.30ppt while Front-Month dropped 0.05ppt due to an increase in gas flows from the Langeled pipeline which have gone from 20mcm a day to 37mcm a day. LNG flows increased by 11mcm a day which also helped the gas market to take a bearish turn with quarterly contracts making losses of up to 0.20ppt. The power curve displayed no real trend as Day-Ahead fell by £0.60/MWh influenced by falling Brent, carbon and APi2 coal prices. Numerous outages at power plants led to July-13 and September-13 contracts opening unchanged despite weaker Brent prices.
1-year forward prices
Market close data has revealed that the 1-year forward price for both commercial gas & commercial electricity made a loss - closing at 68.60ppt and £52.18/MWh, respectively. This can be seen in the graph below.
Note: Brent Crude prices are taken from opening market data, and do not represent the price as it changes throughout the day.
Latest Brent Crude Oil prices
Brent 1st nearby prices fell from to 105.5 $/b with weaker US gasoline markets having an effect and it is thought the Iranian election could also be a factor. Inflation in the United States and German ZEW investment are today's main focus ahead of the API report that will be released this evening.