CCS Weekly Market Report


This week:

  • Prices up on colder weather and heightened Russia threats



  • LDZ demand is up on colder weather, but still 13% below 5-year average
  • EU price cap proposal – if the price of the Dutch front month gas traded on exchange remains above 275 euros per MWh for more than 2 weeks AND the spread to Asian price marks is excessive, the cap is triggered.
  • Gazprom will reduce deliveries into Ukraine destined for Moldova from 28th Nov, on claim 80% of deliveries not leaving Ukraine. It will likely to only impact ~1mcm
  • Freeport confirmed to start phased return in mid-Dec, pending regulatory approval
  • European storages down 1% to 94.6%, UK storage dropped to ~82% full



  • Prices up on back of gas and carbon price rise
  • Weather corrected demand was flat w-o-w, and about 10% below 5-year average
  • French markets regulator cleared French state buyout of EDF
  • Ofgem said the Q123 energy price cap would be £4,279 a year for typical household if the support measures weren’t in place. The cost to govt is expected to be £5bn a month
  • UK ministers are planning to launch a £25m advertising campaign to encourage people to save energy and money
  • French nuclear availability is at 34.7GW (55%)


Wider Commodities 


Prices continued lower w-o-w as China reported the highest daily number of new COVID cases since the start of the pandemic. The G7’s Russian oil price cap is thought to be set around $65-70/bbl, which is higher than expected, which reduced worries about future tight supply. The US gov are prepared to ease Venezuelan sanctions to allow Chevron to increase oil production there, on continuation of talks. U.S gasoline stocks rose by 3.2 million bbls against an expected 383,000 bbl drop, possibly suggesting weaker demand.Carbon prices climbed this week. On Monday it rose 3.8%, with traders suggesting demand was starting to return on cold weather. On Wednesday, it rose a further 4.1% on higher gas prices and short covering. Further RePowerEU talks were held on Wednesday, but nothing decisive. EU Parliament members voted for the EU’s central budget to come from various revenue streams including CBAM and reallocated profits from large multinationals. UKAs climbed in line with EUAs but with smaller increases.Coal prices continued to rise despite no real change in fundamentals. The price rise in Europe is said to be due to the colder weather which was expected to start to cause a draw down in stockpiles. Asian thermal coal buyers expect demand to pick up in coming weeks as winter kicks in. Asian demand is still muted. Chinese buyers are said to only be after very prompt deliveries. China’s coal production in October was 3.6% higher y-o-y but lower than September. Coal and lignite imports fell 11% m-o-m but are up 8% y-o-y.

Posted by Crown Commercial Service Trading Team