Monetary tightening leads to a major banking crisis
Macro & Oil Podcast #31 In this week’s Macro & Oil report of the EnergyScan podcast, Olivier Gasnier tells us about the Silicon Valley Bank…
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Forecasts of stronger demand and slightly weaker renewable and nuclear generation buoyed the European power spot prices yesterday, although the German prices continued to observe a discount due to the country’s still strong wind generation expected to reach up to 41GW at the end of the day. The day-ahead prices averaged 183.05€/MWh in Germany, France, Belgium and the Netherlands, +27.86€/MWh day-on-day.
After a high opening amid soaring gas prices, the EUAs quickly started to drop as the falling equities, a weak auction and fears over the Parliament’s amendments to the EU ETS Article 29a (mechanism designed to control non-fundamentally based prices spikes) expected to be tabled by tomorrow weighed on the carbon market. The 90€/t support level however once again capped the losses and the Dec.22 benchmark partly recovered in the afternoon to eventually settled at 91.76€/t, still -1.11€/t from Friday’s close. The market is neutral this morning as participants are nervously waiting for developments of the Russia-Ukraine situation and for the Parliament’s amendment which could weaken the speculators’ buying appetite. Nonetheless, the reform is likely to take 1 to 2 years to be implemented which means that no additional supply should come to the market in the short-term, and carbon prices could be far from the triggering conditions by then.
The power prices extended rather decent gains along the curve, lifted by the bullish gas market.