Crude oil prices fell back following a 3-day run of gains
04 May 2021
There were further strong gains on NBP prompt and near futures contracts on FridayThere were further strong gains on NBP prompt and near futures contracts on Friday as weather forecasts show temperatures remaining 3°C below the seasonal norm this week. A forecast for a significant increase in wind generation did little to offset the market bullishness which saw prompt prices up by an average of 5.00p day-on-day. The new front month contract for June settled above 60.00p, finishing 8.85p higher over the week and near futures prices generally finished higher by 17% week-on-week. The strong gains of over 2.00p ran out to Winter 21 but increases beyond the front season tapered off to zero by Winter 2023.
As carbon prices surged higher again on Friday, GB and Western European power prices also gained stronglyAs carbon prices surged higher again on Friday with the EU ETS unit price for 2023 topping €50.00 per tonne GB and Western European power prices also gained strongly. The May contract gained just £0.40 on expiry but remaining contracts for the coming 12 months were up by over $1.00/MWh. Wind generation fell off to just over 1GW on Friday but is forecast much higher this week. The day ahead contract shed almost £15.00/MWh while the week ahead contract for this week was up by £1.00/MWh as temperatures are forecast well below the seasonal norm.
Crude oil prices fell back following a 3-day run of gains which saw Brent crude reach 6-week highs mid-week. The global benchmark shed $1.80 to settle at $66.76 while West Texas gained 90 cents to $64.49 a barrel. The discrepancy on movement of the two benchmark crudes was down to optimism around demand recovery in the U.S. and concerns for global demand in light of the dire situation regarding coronavirus cases in India, the world’s third largest oil consumer. The ongoing increase in OPEC production was also a factor in the decline in the Brent price as Iran, which is exempt from OPEC’s production quotas, increased output by 100,000 barrels per day in April.
The ongoing increase in OPEC production was also a factor in the decline in the Brent price