Czech Energy Pricing Trends - 3 Dec. 2021

CO2 price (Dec-21) increased by 5,4 EUR/t WoW to level 79,86 EUR/t WoW to new historical maximum. Today market trades around 80 level. Brent price (Feb22) decreased by 11,25 USD/bbl WoW to 69,67 USD/bbl. Today market has grown and is trading around 72 level now.  Coal API (Dec21) decreased by 34,75 USD/t WoW to 124,25 USD/t. Today coal fell and is trading around 121 level now. CO2 continued to have very bullish development supported by actions of newly elected German government; i.e. setting the bottom price for CO2 at level 60 EUR/t and earlier coal exit by 2030 (before 2038).

Oil fell significantly due to news of new COVID virus variant omicron which threatens global economy recovery.  However, oil has been recovering since yesterday thanks to news that this variant is less dangerous than existing virus variants and possible new vaccines effective against this variant.  Coal weakened significantly in beginning of the week, but has been slowly recovering since then. This is thanks to China´s effort to improve domestic supply situation and curb coal prices.  Some change in electricity market, especially for far curve products, may bring possible inclusion of nuclear on the list of sustainable resources in EU. Electricity prices could then react with a decline. A 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 95 EUR/MWh.

Gas market is experiencing price increase since Tuesday mainly as reflection of the decreasing outside temperatures and approaching winter.  Gas flows into Europe remain rather stable. Gazprom Export did not book any monthly capacity via Poland; however, is doing so via daily capacity bookings. Thus the gas flows are kept circa at November´s level. Weakening oil and coal prices did not push gas price significantly lower. Gas market is obviously driven by its own fundaments.  European gas lobby Cedigaz sees "no quick fix" in gas market before this winter ends. Weather in Europe is forecasted to be below-the-average until mid  December, whereas China should turn from above to below average at about the same time. Gas level in European gas storages decreased by 3,58% WoW (as of Wednesday) to level 67,5%.

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Miroslav Ceman

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