Gas Annuals rise by as much as 9%
Friday 3rd July 2020
The second half on June saw a lot more bullishness in power and gas markets as the easing of lockdown indicated an increase in demand. There has been upward movement in the wider energy complex, with Brent sustained above $40, coal increasing on renewed demand and carbon soaring on the back of speculative trading and the expectation of an increased fossil fuel burn this winter. More gas and coal electricity generation across Europe will have to happen this coming winter due to the delays in French nuclear refuelling during lockdown.
Evidently, the optimism seen in the market could be a false dawn. Whilst there will be a demand spike as governments try to build their way out of recession, demand will overall be down, particularly as so many high street brands go into administration. There is also the spectre of a second wave and associated lockdown which would quash optimism. Hence there is the sense that the current bull-run may peter out. We have seen gas come off today, and EDF have announced more positive figures on their nuclear output, so there are hints of bearishness creeping in.