A retracing and quiet energy complex

The European power spot prices were mixed yesterday, slightly rising in France despite an improving unclear availability, but falling in Germany, Belgium and the Netherlands amid lower clean gas costs and forecasts of higher renewable production. The day-ahead prices averaged 210.16€/MWh over the four countries, -19.59€/MWh from Friday and -18.62€/MWh week-on-week.

The power curve prices eased as well on Monday, driven down by the falling gas prices amid comfortable supply and bearish weather forecasts.

The carbon prices faded throughout the first session of the week amid continuous low liquidity and a refreshing positive correlation with the gas market. The particularly slow activity was attributed to the Easter holiday period which reduced further the already low exchanged volumes the carbon markets has been presenting since mid-March. The morning auction observed a strong result by clearing with a 39-cent premium to the secondary market and above-average 2.26 cover ratio, but the bullish signal was completely ignored by the market and the EUA Dec.22 continued to retrace to eventually close the day at 77.95€/t, -2.14€/t from Friday’s settlement. Prices opened lower today, possibly pressured by yesterday’s bearish momentum and forecasts of warmer weather, but could the near technical resistances might limit the losses. Overall, we have a neutral view on emissions prices again for today with a trading likely to be driven by technicals for a lack of real change in fundamentals.