March energy price trends

The month of March saw energy prices increase massively over the course of the month. The month began with cold temperatures and low wind generation which left the grid undersupplied and saw prices increase. This resulted in oil prices hitting a 14 month high of $68.22/bl, which were back to pre COVID levels. The trend continued into the second week of March as low wind output continued but increases were even larger due to the strength in the trading market of oil, carbon and liquified natural gas. The market conditions, combined with the weather, allowed prices to soar and for carbon to reach record highs of €42.42/t. Just after mid-month, an influx of liquified natural gas cargo ships arrived and assisted some price falls for the first time in the month.  However, this was not enough to stop carbon prices hitting new record highs of €43.63/t. Combined with the news that some European countries were opting to delay continued vaccination rollouts amid news of adverse reactions the market started to become concerned again. These concerns were alleviated with the breaching of an oil tanker in the Suez Canal which led to supply disruption in Europe and ultimately impeded the transit of other tankers, thus boosting the market prices further.

Source: https://www.nfuenergy.co.uk/energy-weekly