February 4, 2013 Week 6. Highlights. Overview

Transcription

1 Energy Market Report February 4, 2013 Week 6 Highlights International commodities were quite affected by the weakening Dollar over the course of last week: oil was up more than 3.50$/b and coal 0,25$/t. For the more local commodities, gas was down on milder weather conditions and power on comfortable production figures and lowered fuel costs on the curve. The only rebound came from the emissions, after news that German renewable schemes would get stricter, moving emissions away from the 3 /t area for some time. Overview Highlights p.1 European Power Spot Prices p.2 European Power Forward Prices p.3 European Gas Prices p.5 Carbon Market Prices p.6 Oil Market Prices p.7 Coal Market Prices p.8 Weather Overview p.9 Exchange Rates p.10 Indices Overview p.11 COMMODITIES Week 04 VS Week 05 ELECTRICITY GAS CO2 OIL COAL WEATHER EXCHANGE RATE SPOT SPOT SPOT SPOT + SPOT + OBSERVED + SPOT EUR/GBP + SPOT EUR/USD

2 European Power Spot Prices Spot prices significantly dropped compared to last week most certainly inspired by the mild temperature conditions. Belpex Settlement last 2 weeks Quote Week 04 Quote Week 05 Delta Base % Off-peak 8-20h % Peak 8-20h % Belpex DAH Power Hourly Prices Week Week Mon Tue Wed Thu Fri Sat Sun Belpex Monthly Average Prices Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec History of Baseload Weekly Average on DAH Prices Belpex Apx Powernext Eex Mar-12 Apr-12 May-12 Jun-12 Jul-12 Aug-12 Sep-12 Oct-12 Nov-12 Dec-12 Jan-13 3 Months History of Weekly Average Spread BE-FR&BE-NL on DAH Prices Belpex-Powernext Belpex-Apx Oct-12 Nov-12 Dec-12 Jan

3 European Power Forward Prices Belgium Overview Curve prices were again down last week, partly driven by weakening fuel prices affecting marginal costs and partly driven by the bearish move on the spot markets. However, the rebound on emissions after Angela Merkel's speech pushed German Cal14 back to 41 area against its low at on Thursday. In Belgium some bullish news came from Electrabel's announcement that further tests would be conducted on Doel3 and Tihange 2, postponing the estimated recommissioning to March. Endex Base BE : Average Quotes last 2 weeks Quote Week 04 Quote Week 05 Delta Feb % Mar % Apr % Q % Q % Q % Q % Cal % Cal % Cal % History of Endex BE Power Base Y Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec History of Endex Power BE Yearly Futures Cal 2014 Cal 2015 Cal

4 European Power Forward Prices BENEDEFR Overview History of Neighboring Countries Baseload Power Y+1 Endex Belgium Endex Holland Platts Germany EEX France Months History of Baseload Power Spread BE-FR & BE-NL Y+1 Endex BE-EEX FR Endex BE-Endex NL Nov-12 Dec-12 Jan-13 Feb

5 European Gas Prices Mild weather conditions pushed NWE gas prices strongly down over the course of last week, mainly on the spot market, but also on the curve. However, because Asian markets continue to price high on LNG cargoes and the Troll platform unavailibility limits Norwegian flows by around 30m³/day, the drop was limited on the curve, which was already quite low against historical levels. Gas Zeebrugge : Average Quotes last 2 weeks Quote Week 04 Quote Week 05 Delta Feb % Mar % Apr % Q % Q % Q % Q % Q % Q % Cal % 29 History of ZIG DAH Prices 30 History of Zig Monthly Average Mar-12 May-12 Jul-12 Sep-12 Nov-12 Jan Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec History of NBP, Zeebrugge, TTF Y +1 3 Months History of Spread Y+1 NBP Zeebrugge TTF NBP-ZEE TTF-ZEE Aug-12 Oct-12 Dec-12 Feb Nov-12 Dec-12 Jan-13 Feb

6 /t /t Carbon Market Prices The downward trend in carbon prices continued last week. The Dec/13 contract traded below 4 /t most of the week. Only on Friday a rebound in prices was seen after the support of German Chancellor Angela Merkel to the German Environment Minister s plan to cap renewable subsidies to limit the rise in power prices for consumers. The Dec/13 contract ended the week at 4.34 /t. CO2 EUA : Average Quotes last 2 weeks /t Quote Week 04 Quote Week 05 delta Cal % Cal % Cal % Cal % History of Point Carbon CO2 EUA Emission Yearly Futures Cal 2013 Cal Months History of Spread EUA-CER in Nov-12 Dec-12 Jan-13 Feb

7 $\bbl $/t Oil Market Prices The weakening Dollar was a major driver of oil prices last week, since globally, most news should have pushed prices somewhat down: EIA oil stocks at their highest levels and OPEC production compressed to its lowest output (mainly coming from an increased effort on Saudi Arabia). But indeed, oil prices started gaining some premium coming from tighter gasoline conditions in the US and upcoming sanctions on Iranian oil exports. GOL 0.1% s : Average Quotes last 2 weeks $/t Quote Week 04 Quote Week 05 Delta Cal % Cal % Brent : Average Quotes last 2 weeks $/BBL Quote Week 04 Quote Week 05 Delta Cal % Cal % Cal % HFO : Average Quotes last 2 weeks $/t Quote Week 04 Quote Week 05 Delta Feb % Mar % Apr % May % Q % Q % Q % Q % Cal % History of Settlement Oil Products Prices (Platts) HFO GOL 0.1% S History of Brent First Nearby Month Forward prices

8 $/t $/t Coal Market Prices Spot coal prices were strongly affected last week from quite a few loadings being notified Force Majeure in Australian ports due to severe weather conditions. But since globally, ARA and Chinese stock levels have significantly increased over the week, the bullish move was limited. Globally, markets signals still carry some clear indication that supply is structurally abundant, meaning that a large part of the coal rise over last week came from the weakening Dollar, as for oil. Coal : Average Quotes last 2 weeks $/t Quote Week 04 Quote Week 05 Delta Jan % Feb % Q % Q % Q % Q % Q % Cal % Cal % Cal % History of Settlement Weekly Index (Argus McCloskey ) History of Coal Yearly Futures Cal 2014 Cal

9 0 = No cloud - 8 = Fully Cloud m / s Degrees Celsius Weather Overview Temperatures are expected to fall from 3C to 5C below average by Days 6 to 10 in a cold Northwesterly airflow. Then they will rise to between 1C and 3C below average for Days 11 to 15 as low pressure becomes dominant in the North Atlantic and introduces a more South-westerly airflow. Precipitation totals are expected to be generally around average within the short term. Winds are expected to be around 30km/h at first, with a high probability of high power generation, but fall to around 10km/h by midweek. Weather overview Week 04 Week 05 Delta Cloud Coverage Level Temperature c Windspeed m/s Hourly Average Temperature Observed Week 04 Observed Week 05 Avg week 06 ( ) Forecast Week :00 06:00 12:00 18:00 Hourly Average Observed Cloud Coverage Week 04 Week 05 Hourly Average Observed Wind Speed Week 04 Week :00 06:00 12:00 18: :00 06:00 12:00 18:00-9 -

10 / / $ / / $ Exchange Rates EUR/USD continued to rally and shows no signs of stalling. This situation is rather supported by a weak USD story rather than a strong EUR story. US FOMC statement of last week tended to paint weak Q4-12 growth as distorted by weather and transitory factors, the Fed still got across its core message that aggressive QE remains in place and it is prepared to do more if the unemployment rate does not fall quickly enough. Treasury yields edged lower on the news and the prospect for US$85bn per month of Fed QE for the first half of the year should keep the dollar soft. Exchange Rates : Average Quotes last 2 weeks Week 04 Week 05 Delta EUR/GBP % EUR/USD % History of Settlement EUR/GBP-EUR/USD Exchange Rates EUR/GBP EUR/USD Focus on Last 3 Weeks Settlement FX EUR/GBP EUR/USD /01/ /01/ /01/

11 / MWh Indices Overview Electricity Luminus Electricity Indices: settlements EMarketCWE Jan-12 Mar-12 May-12 Jul-12 Sep-12 Nov-12 Jan-13 Mar-13 Endex based Indices: settlements Endex 123 Endex 126 Endex Endex Endex Oct-11 Feb-12 Jun-12 Oct-12 Feb-13 Jun-13 Oct-13 Gas Luminus Gas Indices: settlements Gcomfort Gproxy Gcomfort II Luminus Gas Indices :settlements Igm Oct-11 Jan-12 Apr-12 Jul-12 Oct-12 Jan Oct-11 Jan-12 Apr-12 Jul-12 Oct-12 Jan-13 Gas ZB based settlements Zee100 GmarketCWE Jan-12 Mar-12 May-12 Jul-12 Sep-12 Nov-12 Jan-13 Mar

12 Inflation Inflation based indices: settlements Ne Igd Oct-11 Jan-12 Apr-12 Jul-12 Oct-12 Jan

13 Glossary Overview API APX Belpex Brent CER COAL API#2 DAH EEX Endex EUA GOL 0.1%s HFO ICE NBP Powernext Spark Spread TTF ZEE ZIG American Petroleum Institute Amsterdam Power Exchange (Dutch Spot market) Belgian Power Exchange (Belgian Spot market) North Sea oil benchmark Certified Emission Reductions (CO2 Certificates) Coal delivered CIF (cost, Insurance and Freight) in the area of ARA (Antwerp, Rotterdam, Amsterdam) NAR (Net as Received) and on the basis of coal GJ / MT Day ahead European Energy Exchange (German Spot market) European Energy Derivatives Exchange (Belgian-Dutch gas and power Futures market) European Union Allowances (CO2 Certificates) Gasoil 0.1% Sulphur Heavy Fuel Oil Intercontinental Exchange (energy trading) UK gas market (National Balancing Point) French Power Exchange (French Spot market) Spark spreads represent the generating margin of gas-fired power stations. Standard spark spreads are calculated from the difference between power prices and gas prices, adjusted for fuel efficiency. The clean spark spread however takes also into account the cost of carbon dioxide emission allowances. Title Transfer Facility (Dutch market for gas trading) Zeebrugge (Natural gas trading point in Belgium) Zeebrugge Index for natural Gas (Belgian Spot market) Sources FameEnergy Spectron Business Solutions MeteoServices NV The Mccloskey Group European Climate Exchange Commission de Régulation de l Electricité et du Gaz Commission Wallonne pour l Energie Vlaamse Reguleringsinstantie voor de Electriciteits- en de Gasmarkt Federal Planning Brureau: Economic Analyses & Forecasts Belpex SA European Energy Exchange AG Endex European Energy Derivatives Exchange NV Powernext SA UBS PointCarbon APX NV Disclaimer The information contained in this Energy Market Report is for general guidance on matters of interest only. While we have made every attempt to ensure that the information contained in this report has been obtained from reliable sources, EDF Luminus shall not responsible for any errors or omissions, or for the results obtained from the use of this information. All information in this report is provided "as is", with no guarantee of completeness, accuracy, timeliness or of the results obtained from the use of this information, and without warranty of any kind, express or implied, including, but not limited to warranties of performance, merchantability and fitness for a particular purpose. In no event will EDF Luminus, its related partnerships or corporations, or the partners, agents or employees thereof be liable to you or anyone else for any decision made or action taken in reliance on the information in this report or for any consequential, special or similar damages, even if advised of the possibility of such damages. Certain information contained in this report may be obtained from third parties over whom EDF Luminus has no control. It is explicitly emphasized that EDF Luminus makes no representations as to the accuracy or any other aspect of information derived from those sources