EUA carbon costs continue to weaken
17 February 2021
The gas market was in relatively benign mood in early tradingFor the second day in a row temperatures across the UK and Ireland remained above the seasonal norm and gas demand fell off as a result. Demand forecasts for Tuesday were coming in just below the 267MCM mark and line pack was expected to grow by 14MCM. The gas market was in relatively benign mood early and prices were not inclined to move too far from the previous close although the prompt market was a touch softer. The front of the curve did firm somewhat towards the close as both March and April added 0.91p and 0.39p respectively. Prompt prices also firmed despite overall fundamental remaining positive.
GB power futures tracked gas contracts lower again on Tuesday although the power prompt displayed some mixed movement. EUA carbon prices also eased, with all contracts finishing lower by between 65 and 68 cents. With the exception of the front month all GB baseload contracts shed premium with amounted to £0.50 on average. The day ahead softened by £1.25 while some of the longer dated prompt contracts made some gains. With the outlook for wind generation improving in the coming weeks these gains went against market fundamental which come into play in coming days.
GB power futures tracked gas contracts lower again on Tuesday
The crude oil market displayed only modest movement on Tuesday as the market seemed unsure as to the impact of the severe Winter storm in the U.S and in particular in Texas, a significant oil producing state. West Texas Intermediate crude oil resumed trading on Tuesday following the extended Presidents Day weekend holiday. The WTI contract traded in negative territory for much of the session as some concerns emerging on that the weather-related disruption would have a bearish impact. In addition, weather driven curbs in production could gave an impact on crude oil inventories. At market settlement however, crude finished flat.
WTI contract traded in negative territory for much of the session