GLEG UK & European Energy Snapshot...

Daily (09.07.2024): European carbon prices posted their biggest decline in three weeks due to speculative trader sell-off.

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Oil prices lost ground on Monday due to profit-taking and gloomier-than-expected US economic data published last week, raising concerns about the level of demand in the country. Consequently, Brent crude stood at $85.75 a barrel, while WTI crude closed at $82.33 a barrel, both contracts declining by 1%.

On Monday, British near-term gas prices saw a decrease, with the NBP spot price dropping by more than 4% to 74.50 p/therm, as consistent flows from Norway balanced potential LNG supply uncertainties. Along the forward curve, the gas price for Winter 2024 delivery decreased by 1.5%, reaching 96.39 p/therm, impacted by abundant supply and favorable storage reserves.

European spot electricity prices rebounded on Monday, supported by a jump in cooling demand which offset rising renewables generation. The German spot power price surged from 7.36 EUR/MWh to close at 77.69 EUR/MWh, while the French day-ahead contract soared from -4.29 to reach 46.33 EUR/MWh.

Along the forward curve, front-year electricity prices decreased on Monday, tracking bearish gas and carbon prices. The German Cal’25 power price eased by 0.5% to close at 73.16 EUR/MWh. The French Cal’25 power price declined by 2% to settle at 91.53 EUR/MWh, with comfortable nuclear outlook further weighing on prices.

European carbon prices dropped by the most in three weeks on Monday amid aggressive selling from speculative traders. Thus, the EUA contract expiring in Dec-2024 declined by around 2%, hovering just below the key support level of 70 at around 69 EUR/tonne.

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