History of Energy Prices

Wednesday 30 May 2018

 

Historic Factors

 

30 May 2018 – Oil prices fell as Russia hinted at increasing production to offset the reduced exports from Venezuela & Iran, following both countries having sanctions placed on them by the US.

 

22 May 2018 – Carbon EUA’s continue to climb after trading above €16.00/tonne for the first time in several years, bolstering the NBP.

 

15 May 2018 – The NBP is driven by movements in the wider energy markets. Bullish moves in oil, carbon, coal and power are all contributing to rises in the NBP price curve.

 

8 May 2018 – Oil prices lifted after President Trump withdrew the US from the Iran nuclear deal. Brent jumped to its highest level since 2014 as the withdrawal increased the risk of conflict in the Middle East and cast uncertainty over global oil supplies.

 

25 April 2018 – Norwegian outages continue to bolster the NBP prompt with maintenance season in full swing.

 

14 April 2018 – The NBP far curve is driven higher by oil prices as they hit their highest level since 2014 as a result of US led strikes on Syria.

 

9 April 2018 – 2% rally in Brent off the back off a weaker US dollar and easing concerns surrounding a trade war between the US and China lifts the NBP curve.

 

29 March 2018 – The Dutch Government announce that production at Groningen will be reduced to 12bcm. by October 2022.

 

1 March 2018 – The Beast from the East hits the UK bringing temperatures significantly below seasonal normal. As a result, NBP prompt prices rocket off the back of increased demand with the WD contract trading at its highest ever level of 350p/therm.

 

13 February 2018 – The weather continues to drive the market with colder weather resulting in significant gains on NBP prompt.

 

7 February 2018 – A feed control valve at the Kinneil gas terminal led to another shut down of the Forties Pipeline System (FPS) in the North Sea. However, the shutdown was short lived on the system was fully operational the following day.

 

1 February 2018 – The Dutch mining regulator (SSM) recommended Groningen output be cut from 21bcm to 12bcm to ensure the safety of the people of Groningen.

 

29 January 2018 – The NBP prompt continues its trend downwards off the back of a very healthy UK system as a result of strong supply from Europe and the UK continental shelf.

 

8 January 2018 – A large earthquake, of 3.4 magnitude on the Richter scale, hits Groningen. As a result, a further production cut at the gas field comes into question.

 

2 January 2018 – Political tensions in Iran and ongoing OPEC cuts sends Brent crude to near 3 year highs of around $68/bbl.

 

12 December 2017 – Explosion at Baumgartner gas terminal in eastern Austria restricts flows into western Europe.

 

11 December 2017- Forties pipeline shutdown after a crack in the pipe worsens.

 

7 November 2017 – Political uncertainty in Saudi Arabia (World’s largest Crude Oil Exporter) and fears of a tightening market sent global Crude prices to the highest since Summer 2015. Brent Crude traded above $64 barrel.

 

28 September 2017 – French Nuclear units were ordered to temporarily shut down, as soon as possible. Causing gains on Power prices, which filtered through to Gas.

 

25 September 2017 – Oil prices rose to a 26 month high – caused by Turkey’s threat to cut Crude flows from Iraq’s Kurdistan region to the rest of the world.

 

20 September 2017 – Reduction in Power burn, as expectations of high wind generation are assisted by Hurricane Maria.

 

25 August 2017 – Oil prices rose, as the US Oil industry prepared for the arrival of Hurricane Harvey. Production facilities were expected to shut down in preparation, with expectations the closures would last if the storm caused extensive damage.

 

7 August 2017 – Gassco – the Norwegian gas system operator, modified the end date for a planned Field facility outage, adding support to the Gas prices.

 

2 August 2017 – Another major outage for Kollsnes cut Gas flows by 51mcm/day, raising spot prices.

 

26 July 2017 – An extension to unplanned maintenance at the Kollsnes Gas field in Norway was extended out until 1st October 2017, after initial expectations of it to be back online that day.

 

25 July 2017 – Oil prices rose, as OPEC led meeting resulted in Saudi Arabia pledging to decrease exports from Aug-17 onwards, and several other members agreeing to boost compliance to tackle global supply glut and price flagging.

 

20 June 2017 – Centrica made the decision to close the UK Rough Gas storage site permanently. After numerous tests, it was decided that the facility was not safe to return to injection and storage operations.

 

8 June 2017 – 2 Qatar LNG cargoes which were destined for South Hook were diverted.

 

5 June 2017 – Sharp rise in prices, as Saudi Arabia, Bahrain, Yemen and the United Arab Emirates are said to have cut diplomatic ties with Qatar following claims the country could have ties to terrorism.

 

2 June 2017 – Oil prices fell on the back of President Trump’s decision to withdraw from the global climate change pact. It is thought that this could potentially lead to more crude drilling in the US, increasing the current global supply glut.

 

15 May 2017 – An extension of output cuts was agreed by Saudi Arabia and Russia (the world’s top 2 Oil producers) to extend current cuts for another 9 months, up until March 2018 – all to try and control the global supply glut. This was all to try and control the global supply glut. Oil reacted with a sharp increase on the back of the news.

 

12 April 2017 – Announcements made that Rough will not restart injection operations in the 2017/18 storage year. Based on safety and failure tests and extensive discussions, CSL decided that that was the best way forward.

 

4 April 2017 – The severe tropical storm, Cyclone Debbie in Australia caused massive supply disruption for Coal.

 

2 March 2017 – Reports were released on 1st March 2017 stating that Trump was set to target certain Obama-era regulations. Including the federal coal mining ban and cuts on carbon emissions.

 

16 February 2017– Centrica announced that Rough (Britain’s largest natural gas storage site) would be unavailable for Gas injection until at least 1/7/17. Testing was ongoing to assess the safety and condition of the asset which is very old yet still very important to the Gas industry.

 

31 January 2017 – Colder than seasonal normal weather, lower than expected renewable output and concerns over storage availability, all created supply concerns.

 

Outlook

 

Potential Bearish Price Drivers ↓

 

  • Low UK demand Warmer weather forecasts.
  • Interconnector maintenance in June (13th – 28th).
  • LNG arrivals (Isle of Grain Arrival on 2nd June).
  • Strength in GBP

 

Potential Bullish Price Drivers ↑

 

  • Strength in commodities; oil, coal and carbon
  • Geopolitical events
  • Global Demand
  • OPEC cuts
  • Outages and Maintenance
  • Low UK and Continental storage levels
  • Cooler weather forecasts.
  • Poor renewable generation.
  • Low Wind generation.
, , , , , , , , , , , , , , ,
Previous Post
Daily Energy Market Report Wednesday 25th July 2018
Next Post
Plastic bag sales in England plunge 86% since 5p charge

Related Posts

Menu