Electricity – EEX Baseload Futures
Prices fell slightly in the earlier fortnight in reaction to EDF's announcement of an increase in projected production for the 1st quarter of 2023 (postponement of the shutdown of nuclear power plants). On the other hand, prices stabilized in the second half of the month thanks to lower gas prices, the "springtime" drop in demand and high solar production. The second half of June became tense and markets were much more volatile. The reduction in Russian gas deliveries to Germany by 60% in mid-June had a major impact on energy markets, generating an all-time high for CAL23 BL of 365 €/MWh at the end of the month. Fears about supply security during the coming winter are coming to the forefront. CAL 23 BL started out the month at the price of 307.53 €/MWh, versus 365.67 €/MWh now (+19%), whereas CAL 24 BL saw a limited 4% increase over the same time.
Carbon – EUA Futures
Carbon prices have remained relatively stable this month at 83-84 €/t. At the end of the month, they jumped (+5 €/t) following announcement wishing to increase the production of coal-fired power plants to compensate for the decline in gas flows. Carbon closed out the month at 89.78 €/tCO2eq.
Natural Gas – EEX PEG Futures
The opening two weeks of relative stability (around 74 €/MWh), the European and French markets reacted immediately to the snap decrease in the delivery of Russian gas via Nord Stream 1. Concern about not reaching the target of a 90% storage fill rate before winter is growing across Europe. Worse yet, the German energy major Uniper is on the cusp of insolvency. It (and the sector?) will need to be rescued by the federal government. CAL 23 prices reached 99.67 €/MWh by month’s end, a 38% increase against the beginning of the month. CAL 24 jumped up 20%, reaching 72.33 €/MWh in late June.
Fuel – London Brent Spot
Solutions are being sought to compensate for the drop in exports from Russia, including oil from Iran and Venezuela. In China, new lockdown measures have given rise to talk of a decline in demand which forestalled price increases during the month of June. Brent closed at 109.16 $/bbl on June 30th, a 5% contraction when measured against June 1st.
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