Brent crude settled at a 12-week high of $44.96 a barrel
23 November 2020
The slide in European gas prices continued for a fourth day on FridayThe slide in European gas prices continued for a fourth day on Friday with near futures prices at the UK NBP down by 10% over the week. Although Friday’s losses were less significant than the previous 3 days, the front month contract fell to 36.31p, down 9.70p from its recent high of 46.00p just 4 weeks ago. As wind availability fell off, demand on the UK gas system increased to 265MCM by close of business, its highest so far this winter. The supply-side response was robust, the system retaining a positive balance throughout the day and spot and day ahead contracts fell by 2.50p. The week ahead for this week was down by 2.00p to align with the December contract at just over 36.00p.
Falling gas prices outweighed higher oil and carbon prices to pull GB power futures lower on FridayFalling gas prices outweighed higher oil and carbon prices to pull GB power futures lower on Friday. Near futures saw the bigger losses on the day with the front month down by £1.35/MWh but seasonal contracts for Summer 2021 and beyond saw only marginal losses as rising oil and carbon markets offered support. The day ahead contract fell on forecast higher wind availability for today and the week ahead shed £1.35/MWh. Wind generation, which accounted for just 3GW on Friday, is at 6GW today and is forecast higher for the remainder of this week.
The oil market turned higher again on Friday as the market looked ahead to increasing demand next year as Covid-19 vaccines come on stream. Brent crude settled at a 12-week high of $44.96 a barrel and West Texas Intermediate gained almost a dollar to settle at $42.15 a barrel, seeing the largest weekly percentage gain since June. But prices remain a long way from a full recovery after the damage caused by the pandemic, down 31% year-to-date. Carbon prices continued to fluctuate with EU ETS unit prices gaining 40 cent on Friday to leave prices little changed week-on-week.
Carbon prices continued to fluctuate