Headlines
Wholesale power and gas contracts experienced mixed movements this week, as most baseload power contracts and near-term (up to and including summer 19) gas contracts followed EU ETS carbon and API 2 coal prices lower, whilst recovering Brent crude oil prices pushed seasonal gas contracts up. Most baseload power contracts fell, with day-ahead, winter 20 and summer 21 the exceptions. Day-ahead power started the week at a one-month low of £57.0/MWh; however, forecasts of lower wind generation supported prices towards the end of the week, rising 0.5% to £62.4/MWh. Most seasonal baseload power contracts fell, down 0.7% on average. Near-term gas contracts up to and including summer 19 fell. Day-ahead gas was down 2.1% to 59.3p/th, as forecasts of milder temperatures until 18 January, and firm LNG send-out so far this year, have pressured prices. Day-ahead gas dropped to a five-month low of 57.0p/th on 10 January. Seasonal gas contracts rose 1.5% on average, however, summer 21 gas dropped 0.4% to 53.5p/th. Brent crude oil prices recovered from the previous week, rising 8.5% to average $59.8/bl as OPEC’s 1.2mn bpd production cut began. API 2 coal prices dropped 2.8% to average $82.2/t, pressured by a milder start to the year, full coal stocks and increasing competition from gas in European markets. EU ETS carbon prices dropped 9.7% to average €22.4/t. Weak demand at auctions led within-day carbon prices to drop to $21.4/t on 10 January, a one-month low.
Baseload electricity | | |
- Day-ahead power rose 0.5% week-on-week to £62.4/MWh amid forecasts of lower wind generation.
- February and March 19 power contracts dropped 3.8% and 4.3% to £61.5/MWh and £58.6/MWh respectively.
| | - Annual April 19 power dropped 2.1% to £57.9/MWh.
- The contract is 6.4% below the same time last month when it was £61.8/MWh and 28.6% higher than its value last year (£45.0/MWh).
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Forward curve comparison 
| | Annual April Contract 
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Peak electricity | | |
- Day-ahead peak power rose 2.3% to £69.8/MWh. This was £7.4/MWh above its baseload counterpart.
- Month-ahead peak power went down 4.6% to end the week at £67.7/MWh, £6.2/MWh above its baseload counterpart.
| | - Week-on-week, annual April 19 peak power fell 2.1% to £63.1/MWh. The contract was £5.2/MWh above its baseload power counterpart.
- The contract was 6.1% below its price last month (£67.3/MWh) and 25.7% higher than its value last year (£50.2/MWh).
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Forward curve comparison 
| | Annual April contract
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Seasonal power prices | | |
Seasonal baseload power contracts 
| | Seasonal baseload power curve 
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- Seasonal contracts between summer 19 and summer 20 dropped, with seasonal contracts down 0.7% on average.
- Summer 19 power was down 2.5% to £54.6/MWh, having dropped to a two-month low of £54.4/MWh on 10 January.
| | - All seasonal peak power contracts went down this week, the second consecutive weekly decline.
- Seasonal peak contracts fell 1.3% on average.
- The summer 19 contract saw the largest change, down 2.7% to £58.3/MWh.
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Commodity price movements | | |
Oil and Coal 
| | Carbon
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- Brent crude oil prices recovered from the previous week, rising 8.5% to average $59.8/bl.
- Oil prices have been supported by OPEC’s 1.2mn bpd production cut, with analysis from S&P Global Platts that the group’s output dropped 630,000bpd in December to a six-month low of 32.4mn bpd.
- Russia, which has committed to cut 230,000bpd, has dropped production to 11.38mn bpd in 2019, down from a record high of 11.45mn bpd December.
- API 2 coal prices dropped for the third consecutive week, down 2.8% to average $82.2/t.
- Coal prices have been pressured by a milder start to the year, full coal stocks and increasing competition from gas in European markets.
| | - EU ETS carbon prices dropped 9.7% to average €22.4/t.
- Weak demand at auctions led within-day carbon prices to drop to $21.4/t on 10 January, a one-month low.
- A total of 7.5mn EUAs were available for auction this week, rising to 11.9mn next week as Poland’s first auction of the year takes place on Wednesday.
- The European Commission announced that German carbon auctions are expected to return in February and will include unauctioned EUAs from the postponed auctions since 14 November 2018.
- The Brexit vote in the House of Commons on 15 January may continue to weigh on market sentiment.
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Wholesale price snapshot
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