The crude oil markets buoyed by recent news of vaccines
20 November 2020
The gas markets were bearish yesterday as both the prompt and futures markets fell significantlyWith the prospect of extending lockdowns in the UK being considered, the gas markets were bearish yesterday as both the prompt and futures markets fell significantly. There was some pressure exerted on the gas system though as demand rose to 267MCM in the afternoon and supplies lagged by 12MCM but still the spot and day ahead products eased by around a half a penny. All the prompt contracts settled at or around 36.55p, aligning them closer to the front month which shed 1.56p yesterday. As was the case over the previous two days, declines on the curve were greater on the near months but contracts from the summer out still shed an average of 0.85p.
There were significant losses on the GB power curve on ThursdayWhile there were significant losses on the GB power curve on Thursday, the day ahead product firmed on forecasts for lower wind. Baseload futures eased by up to £1.65/MWh yesterday as lower gas and carbon prices weighed. Trading in the carbon EUAs markets was also bearish as the spot settled at €26.34 per tonne, the lowest point for the week. Wind generation was over 8.3GW on Thursday, but forecasts for Friday are closer to 3.0GW, around 35% of the levels seen yesterday. The day ahead product responded and settled £3.89/MWh higher at £44.77/MWh.
The crude oil markets buoyed by recent news of vaccines, switched focus yesterday to the surging numbers of new coronavirus cases and concerns for global crude oil demand. With record new daily cases of Covid-19 in Japan, Russia and the U.S., the markets have raised fears that global demand will decline as movement is curtailed and lockdowns increase and with producers like Libya looking to increase output, there could be a return to a supply glut. OPEC and its partners are set to meet at the end of the month and its thought that the group may defer their plan to increase production levels by 2 million barrels per day from 1-Jan-21.
The crude oil markets buoyed by recent news of vaccines, switched focus yesterday to the surging numbers of new coronavirus cases