Daily (12.03.2019): Oil prices soared by 1.3% on Monday on continued OPEC-led supply cuts

12/03/2019 10:17 Daily

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Crude oil prices gained ground on Monday, as Saudi Energy Minister Khalid al-Falih said that OPEC-led supply cuts will unlikely stop before the group meeting in June. Both Brent crude and WTI futures rose by 1.3% to $66.58 a barrel and $56.79 a barrel respectively.

British gas prices declined on Monday as strong output from the country’s wind farms reduced demand for gas-for-power.  However, colder temperatures put a lid on losses. As a result, NBP spot price dropped by 1.1% to 42.40 p/therm, while the Q3 2019 delivery contract traded 1.1% lower at 43.42 p/therm.

 

European day-ahead power prices skyrocketed on Monday, due to lower generation from wind sources and increasing demand. The price for the German spot power contract soared by 358.5% to 36.59 EUR/MWh, while the equivalent French contract traded 64% higher at 39.41 EUR/MWh, influenced by a drop in nuclear availability.

 

Along the curve, electricity prices posted losses, tracking weaker carbon and coal markets. The price for the German power contract for delivery in 2020 dropped by 0.6% to 47.89 EUR/MWh, while the equivalent French contract traded 0.3% down at 51.13 EUR/MWh.

 

EU carbon prices lost momentum on Monday, due to a bearish energy complex and ahead of Brexit votes related to the UK’s future in the EU carbon market. The price for the 2020-expiry contract fell 3.2% to 22.69 EUR/tonne.

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