Market Updates


Energy Market Report – 29th May 2018

Key Points:

  • UK Electricity and Gas forward curve prices lifted up on the back of rising Brent Crude
  • A political crisis in Italy impacts on the European financial markets, depreciating the value of the Euro

UK Electricity Prices:

Power remains strongly correlated with gas on the curve and movements in power reflect the drop in the price of fuels, namely oil. Forward contracts moved up reflecting crude oil and UK nat gas direction. Win-18 is currently trading at £61.90/MWh, while Sum-19 is at £49.50/MWh.

Wind is just below 4GW today, this has led to a reduction in output from CCGT and has subdue coal down to 200MW. The French interconnector is importing at full capacity, with the Dutch at just 245MW. 

UK Natural Gas prices:

This morning NBP opens with a more bullish feel recovering some of the losses from Friday. An unplanned gas outage over the weekend looks to be providing the initial support, with carbon at an all-time high also lifting prices. The gas system is balanced today; the unplanned outage at Kollsnes has disrupted Norwegian flows with the Langeled pipeline down to 25mcm. This reduction is supply is offset by reduced demand, which is 25mcm below averages. Temperatures have been revised slightly cooler, although remain comfortably above seasonal averages.

Carbon prices continue to be bullish, trading at all-time highs of around €16.50. This increases the overheads for gas and power generation and therefore supports prices. Oil prices dropped off towards the end of last week, and have since moved sideways, now trading at $75.46/bbl. News of a potential Saudi and Russian led production revival plan spooked traders and drove prices lower.


A political crisis in Italy is stirring a selloff on European financial markets for the second day in a row.  The Euro slipped to a 6.5 months low, while the cost of short term borrowing has surged.

Italy’s anti-establishment parties abandoned plans to form a coalition government after the country’s president, Sergio Mattarella, refused to accept their Eurosceptic candidate for Economy Minister.