Czech Energy Pricing Trends - 10 Dec. 2021

CO2 price (Dec-21) increased by 0,34 EUR/t WoW to level 80,2 EUR/t WoW; however, maximum reached this week was over 90 EUR/t. Today market is trading around 82 level. Brent price (Feb22) increased by 4,75 USD/bbl WoW to 74,42 USD/bbl.  Today market is trading around 75 level.  Coal API (Jan 21) increased by 9,45 USD/t WoW to 133 USD/t. Today coal grew and is trading around 134,5 level now.

The CO2 continued to have very bullish development and reached 90 EUR/t level, but yesterday retreated by 10 EUR/t close to 80 EUR/t.

The traded volumes are high pointing to the coming trading break from 20 December to 10 January. The warmer weather predicted for next week could keep SPOT demand lower. On the other side many big energy consumers are probably short and will have to close their open positions for next year.  The closing positions might push demand and prices up on forward market. Some change in electricity market, especially for far curve products, may bring possible inclusion of the nuclear on the list of sustainable resources in EU.  Electricity prices could then react with a decline. The decision is expected in the middle of this month.

Slovak power market followed the trend of Czech market.

Slovenian market followed trend on other European electricity markets.

SPOT prices had growing trend. SPOT prices exceeded 103 EUR/MWh.

Gas market was experiencing significant price increase since beginning of this week supported by weather forecast and tension on Ukraine/Russian borders. The risk related to future of Nordstream II project significantly pushed gas prices up, especially for period Q2-Q4 2022. USA and Germany agreed that NS II will not start if Russia would invade Ukraine. The warmer weather forecasted for 2nd half of December should be followed by colder temperatures in January.  Thus weather in Europe is forecasted to be below average in beginning of January; whereas China should be above average in this period. Some change in gas market outlook, especially for far curve products, may bring possible inclusion of the nuclear on the list of sustainable resources in EU, which should decrease gas-to-power demand in long term.  Gas level in European gas storages decreased by 3,22% WoW (as of Wednesday) to level 64,27%.

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Miroslav Ceman

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