Daily (10.01.2018): UK next-month gas contract traded 2.5% higher on concerns that gas production from Groningen field will be cut

10/01/2018 11:34 Daily

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Oil prices surged on Tuesday, buyout by OPEC-led output cuts and predictions that U.S. crude inventories have declined for an eighth week in a row. 

Brent crude ended the session up $1.04, or 1.5 percent, at $68.82 per barrel after touching a session peak of $69.08, its highest since May 2015. Meanwhile, U.S. West Texas Intermediate (WTI) crude rose $1.23, or 2 percent, to close at $62.96 a barrel, after hitting its highest level since December 2014 at $63.24.

 

British wholesale gas prices increased on Tuesday as forecasts for milder weather boosted demand and on concerns that production could be further cut from the Netherlands’ Groningen gas fields. Day-ahead gas price soared by 0.85 pence, or 1.6%, to 53.90 p/therm. Meanwhile, February contract traded 1.33 pence, or 2.5%, higher at 54.42 p/therm. Summer 2018 contract up 0.48 pence at 45.25 p/therm.


European spot electricity prices for day-ahead delivery diverged on Tuesday as expectations for a sharp decline in wind power generation lifted the German contract, while higher nuclear power supply and lower consumption weighed in France. The German baseload power price for Wednesday delivery soared by 37% to 41.33 euros/MWh. The equivalent French contract tumbled by 12.5% to 41.19 euros/MWh.


Along the forward power curve, the European benchmark, Germany’s year-ahead Cal’ 19 delivery contract added 0.3 percent to 36.51 euros, following oil and carbon prices. The equivalent French forward power contract for the coming year traded 0.2% up at 41.26 euros/MWh.


EU carbon prices increased in light volume on Tuesday, recuperating from all the previous day’s losses to rebound from a three-week low. 2019-expiry carbon emission allowances settled 1.6% up at 7.84 euros a tonne.

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