Carbon EUAs added around €1.55 per tonne yesterday
11 June 2021
Volatility returned to the UK gas markets on ThursdayVolatility returned to the UK gas markets on Thursday with futures flipping between losses and gains all morning until the market finally started to rack up some momentum to settle an average of 0.75p higher. Gains would have been stronger on the day but were partially reversed just before the close after an announcement from Nord-Stream 2 which said pre-commissioning work would start today on the new underwater gas pipeline from Russia to Germany. Prompt prices settled higher for the most part with a tight gas system providing support to the spot which settled 0.80p higher at 69.55p.
The sharp gains in carbon EUAs and gas futures fed into the baseload power curveThe sharp gains in carbon EUAs and gas futures fed into the baseload power curve on Thursday afternoon after prices had remained flat earlier. The front month closed £0.50/MWh up on the day which was above the average gain for the curve. Carbon EUAs added around €1.55 per tonne with the spot settling at €53.69 per tonne. Forecasts for wind generation to increase today pressured the day ahead contract yesterday. Wind is now forecast to average close to 9.0GW on Friday up from around 7.5GW for Thursday. Baseload for the day ahead closed at £69.56/MWh falling by £2.78 from the previous close.
Crude oil prices dipped during the session after media reports of a lifting of sanctions on Iranian officials was misinterpreted as sanctions be lifted on Iranian oil. The markets recovered quickly, and Brent settled 67 cents a barrel higher while West Texas Intermediate settled at $70.29, up 33 cents a barrel. The misunderstanding was later cleared up by the U.S. Treasury who stated sanctions had been removed from three former Iranian officials attached to two petrochemical products and was not related to the talks with Iran. Iran could add around 1.5m barrels of crude per day to the market if sanctions were to be lifted following successful negotiations for a nuclear deal.
Iran could add around 1.5m barrels of crude per day to the market