EUA carbon contracts posted losses of more than €1.00 per tonne

14 March 2024

Gas Market

The UK gas market along with most of its continental counterparts continued to operate in a tight range with prices never straying too far from the previous settlement.  That said, the market did oscillate between gains and losses over the course of the day but in truth these were constrained to minor amounts.  Case in point being the front month which reached a high of 63.90p per therm and a low of 62.40p which proved to be the eventual settlement price.  The Front Summer closed flat 62.42p, while Winter 2024 was up by 0.12p as this contract settled at 75.51p. The supply/demand outlook remains extremely positive with warmer temperatures reducing demand and keeping the system well supplied.  Conditions remain positive for wind generation, and this also helped suppress demand from CCGT generation.

Power Market

GB baseload contracts at the front of the curve displayed some minor losses which were brough about by reducing carbon coats and lower spark spreads. Contracts from winter 2024 forward saw some small gains but with liquidity thin for these periods most of these contracts were subject to price assessments. Wind generation came it at 11.5GW although forecasts are lower for the coming period. EUA carbon contracts posted losses of more than €1.00 as this market downward journey continued.  The spot EUA contract shed €1.07 to close at €54.14 a tonne.  EUA futures shed €1.13 to €1.19 as prices ranged between €55.87 and €59.40 a tonne. 

Oil Market

The crude oil market threw off the statis of the previous session and pushed higher during trading on Wednesday. The Brent crude contract traded in a range of just over $2.00 in a choppy session was. The global benchmark traded to a high of $84.96 before paring some of the gains late on but still settled $84.03 a barrel, up by $2.11 from the previous session. The upward pressure on the market came from the latest weekly inventory data that was published by the US Energy Information Administration. The report showed that both crude oil and distillate inventories dropped last week which broke the trend of six weeks of stock builds. Ukrainian attacks on Russian oil infrastructure also provided some upwards pressure.

Markets this morning

Early trading on crude oil markets has seen the Brent crude extend gains for a second session in a row with 65 cents added so far this morning.  The gas market is under pressure with all contracts that have traded thus far showing signs of weakness. The front month is prices at 61.83p, down by 0.57p while summer 2024 has shed 0.42p as it trades at 62.00p flat. The gas system is well supplied once again this morning and is currently running with a surplus of 9MCM. On the prompt gas market both the spot and day ahead contract have posted losses of 0.90p and 0.70p at this early stage.