Crude oil markets became concerned that the U.S. presidential election may be taken to the courts
06 November 2020
Demand was well above the seasonal norm at 275MCM yesterdayThe UK gas system ran with a surplus of over 10MCM at times on Thursday but the strong demand due to cooler temperatures drove UK gas prices higher. Demand was well above the seasonal norm at 275MCM yesterday and with LNG send out topping 70MCM, the highest levels since May, the UK gas system still called on storage reserves to shore up supplies. The markets reacted with the spot and day ahead gaining almost a penny each while near NBP curve futures contracts added over 1.50p. Contracts did retreat off intra-day highs late in the session as crude oil prices started to ease.
Baseload power futures closed higher after strong support from the gas and carbon marketsBaseload power futures closed higher after strong support from the gas and carbon markets yesterday. The power curve moved up by over £1.00/MWh on average as the front month settled at £48.15/MWh. Gains of an average of 2.8% to the NBP curve, coupled with 3.5% increases in Carbon EUAs provided the upward momentum. Forecasts for low wind generation in the UK while demand is expected to increase put pressure on the prompt contracts yesterday. Baseload for the day ahead had declined by £9.75/MWh on Wednesday but settled £3.45/MWh higher yesterday.
After three days of recovery, crude oil prices eased on Thursday as the U.S. presidential election remains unsettled while more lockdowns commence across Europe. Brent had gained $3.77 a barrel this week until yesterday when the global benchmark posted a loss of 30 cents a barrel. The short rebound in crude oil prices was halted as the markets became more concerned that the U.S. presidential election may be taken to the courts to be decided as the incumbent sees early leads in key states being eroded. In Europe concerns that the new round of lockdowns in France, Germany and the UK will hit demand recovery for another month at least.
After three days of recovery, crude oil prices eased on Thursday