Crude oil prices continue the run of gains
09 February 2021
Prompt gas prices, which had opened sharply higher, went on to register further gainsAs temperatures fell to below zero in parts of the UK over the weekend, the cold spell intensified yesterday, pushing demand on the UK gas system to almost 400MCM. Wind generation accounted for 25% of GB power demand on the day, without which the gas system would have struggled more severely. As it was, the system slipped from an early supply surplus to run slightly short for most of the trading day. Prompt gas prices, which had opened sharply higher, went on to register further gains with the spot price up by almost 10.00p on Friday’s closing level. The day ahead contract gained 7.35p to close at 57.75p while the front month was up by 4.94p to 53.11p.
Baseload futures power contracts gained for a third consecutive day with the front month settling above £60, up £3.45/MWh day-on-day and 12% week-on-week. The front winter contract also settled above £60 for the first time. Carbon prices gained strongly for a second consecutive day to settle at new record high levels of €38.56 to €39.17 per tonne. The day ahead gained strongly for a second consecutive day as demand topped 40GW and gas and carbon prices surged higher. The day ahead contract might have gained more but for a robust level of wind generation which contributed 25% of total demand yesterday and is forecast to remain high for the coming days.
Carbon prices gained strongly for a second consecutive day
Optimism arising from Covid-19 vaccination programmes and the imminent roll-out of a new stimulus package for the U.S. economy, saw crude oil prices continue the run of 8 consecutive days gains. The global benchmark, Brent crude, gained $1.22 to settle above $60.00 a barrel for the first time in just over a year. WTI crude closed 2% higher at $57.97 a barrel, the highest closing price in nearly 13 months. Analysts quoted by Dow Jones say the rally is being driven by fundamental factors, with US oil inventories continuing to fall and global production levels still relatively low, but also by broad-based optimism for a stronger global economy as the world moves beyond the coronavirus pandemic.
Crude oil prices continue the run of 8 consecutive days gains