Crude oil has fallen slightly overnight
08 April 2021
UK gas system ran a supply deficit for most of the day yesterdayThe UK gas system ran a supply deficit for most of the day yesterday as wind generation levels fell off, increasing gas-fired power demand to 90MCM and overall demand to over 300MCM. Temperatures rose slightly across Ireland and the UK on Wednesday but the fall in wind far outweighed any easing of heating demand. Despite this, prompt gas prices eased with the day ahead contract shedding 1.75p. Gas futures contracts recorded losses for the first time in a week with the front month down by a penny but losses beyond the front winter were marginal.
The day ahead baseload contract eased a little as wind is forecast to pick upLosses on the gas market were not fully reflected on the GB power futures market as carbon prices remained near record highs on Wednesday. EU ETS unit prices shed €0.38 per tonne, but remain in a range between €43.76 and €44.76 per tonne. The front winter contract was the only notable mover on the day, shedding £0.55/MWh. The day ahead baseload contract eased a little as wind is forecast to pick up again today. Having fallen back to just 4GW yesterday, wind generation is expected to climb to 10GW today.
Following recent volatility on the oil market, prices were relatively stable on Wednesday with Brent crude settling 42 cents higher day-on-day at $63.16 a barrel. The U.S. benchmark, West Texas Intermediate saw a little more movement intra-day but finally gained just 42 cents also to settle at $59.77 a barrel. The market focus of the day was the weekly U.S. inventory data which produced conflicting signals with crude oil stocks falling but gasoline and distillate stocks rising last week. The underlying concern for demand recovery continued with rising Covid case numbers in Brazil, Europe, the Eastern Seaboard of the U.S. and India. Carbon prices fell back slightly from the new record highs of Tuesday.
Following recent volatility on the oil market, prices were relatively stable on Wednesday