Power prices were buoyed by the bullish fuel complex amid coming Russian oil ban and anticipation of military escalation

Yesterday marked another day of particularly flat European power spot prices with the ongoing wind shortage being offset by slightly higher French nuclear availability and hydro production. The day-ahead prices averaged 234.07€/MWh in Germany, France, Belgium and the Netherlands, +3.58€/MWh day-on-day.

Conversely, the power forward prices extended hefty gains along the curve, driven up by a steep rise of gas and coal prices as the European Union is heading toward a Russian ban oil while the energy markets are nervously waiting for the next step and possibly military escalation that might follow May 9^th celebration. The energy complex indeed jumped after the European Commission proposed a complete embargo on Russian crude and petrol supplied, raising concerns over a full Russian fuel supply disruption. Traders also pointed to the markets’ low liquidity that may have fueled the prices’ significant volatility observed yesterday.

Still on the power side, EDF confirmed its 2022 nuclear output target of 295-315TWh along with its 300-330TWh target for 2023, stating that the company remains in “an early phase in the assessment of [their] corrosion situation” while awaiting for the ASN ruling expected at the end of this month.

As expected, the carbon prices took an opposite direction from the rest of the energy complex and dove down to 86€/t in the afternoon but managed to recover at the end of the session, the benchmark contract eventually closing at 88.31€/MWh, +12-cent from Tuesday’s settlement.