Market Updates



Ignite bring you the latest energy news across the UK and Europe. We track and analyse changes in the energy market to keep you informed and up to date. Here’s the latest news from the UK, Europe and the rest of the world.

Last week has been bearish with extended losses across the wholesale power in the UK, almost 6% lower weekly. The natural gas market moved in the same direction by losing nearly 4 % from a week ago.  The impact of coronavirus has canceled out any upside potential driven by reduced oil stocks or by measures introduced by governing bodies.

Carbon prices have fallen by more than 23% in the last week thus adding further pressure on power contracts. Caron permits are currently priced at two-year lows, €14.83/t. As of this morning, season-ahead (i.e. Sum-20) power contract, opened at £30/MWh; this is only the second time in the last decade that we see front-seasonal contracts opening that low.

Oil prices dropped by 10% last week as more countries have now started implementing lockdown measures thus leading to significant reductions in fuel demand while Saudi Arabia’s oil production keeps increasing. Currently, Brent Crude is trading at $25.68/bbl.

The UK energy market last week:

  • UK Power prices dipped by another 4.9% this week, on the front of the curve, in line with the market conditions in the global energy commodity complex.
  • UK wholesale natural gas prices continue the downwards price movement on the back of the weak energy commodity complex while fundamentals remain quite comfortable.
  • Wholesale power and natural gas prices opened further lower this morning as coronavirus dominates the headlines.

UK Natural Gas prices:  

British wholesale natural gas prices moved even further on the downside during last week. On top of the weakening commodity complex, stable flows from Norway and increasing arrivals of LNG tankers weighed on prompt and front-curve contracts. By the end of March, 22 LNG tankers will have docked in the UK, the same number of vessels as in January.

Month-ahead settled at 22.50p/th on Friday, a fall of 1.7%, week on week.

In terms of curve contracts, Sum-20 settled at 22.38p/th on Friday, that is a 4.9% movement on the downside, week on week, while Win-20 fell by 4.6% during the same period, at 33.68p/th.

UK Electricity Prices:

UK power prices mirrored the gas price movement despite a week of moderate renewables generation. The downfall in carbon prices has had a major impact on power prices. Last week the carbon market moved by 5.27% on the downside and settled at €20.67/t.

Month-ahead closed last week at £31.00/MWh, that is 5.2% down, week on week.

Sum-20 contract fell by 7.8% week on week and settled at £30.45/MWh on Friday while Win-20 closed the week 5.9% lower, at £39.62/MWh.


Major central banks around the globe have taken measures to ease off any shock to the economy caused by the coronavirus. The Federal Reserve lowered its interest rate to 1.25% from the 1.75% a month ago.  In England, the BoE have cut the interest rate twice in March, from 0.75% to 0.1%.  Also, the ECB has announced a plan to contribute €750 to the EA (Euro Area) as a response to the pandemic.

The Pound is currently trading almost level with the Euro, at €1.086 as the Brexit trade negotiations have now paused while the impact of the coronavirus weighs heavily on the economy. The Pound is trading at35-year lows against the US Dollar, at $1.1585.

What to watch this week

Outlook: Renewables generation started the week strong and is expected to remain healthy for the remainder of the month. Weather fundamentals are more likely to remain as the currently stand, with milder weather forecasted for the 5th of April.

Wednesday March 25: UK YoY inflation rate for February will be announced with market expectations set at 1.5% level amid a slowdown in price increases last month.

Wednesday March 25: US Crude Oil Stocks Weekly Change. Last week’s build-up in crude stocks reached 1.94mln barrels. Any significant drop in the crude stocks might provide upside potentials to oil prices; however, this month is not enough to cancel out the impact of the coronavirus.

Thursday March 26: BoE interest rate decision to be made. The bank decided to reduce its key interest rate twice in the last month as a response measure to the widespread effect of the coronavirus in the economy. However, interest rates are currently at 0.1% so no change is expected to occur on Thursday’s meeting.

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