Daily (11.12.2020): Brent crude tops $50 for the first time since March amid vaccine optimism

11/12/2020 10:48 Daily

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Oil prices surged on Thursday, with Brent crude surpassing $50 a barrel for the first time since March as optimism surrounding Covid-19 vaccine progress lifted the outlook for consumption. Moreover, the oil market was spurred by reports suggesting Chinese demand is exceeding pre-Covid levels.

 

Hence, Brent crude for February delivery rose by $1.39, or 2.8%, to settle at $50.25 a barrel. Meanwhile, U.S. WTI crude for January delivery soared by $1.26, or 2.8%, to close at $46.78 a barrel. Both contracts marked their highest settlements since March 4.

All British gas contracts gained ground on Thursday, with near-term prices buoyed by a tight system due to planned maintenance in Norway. Consequently, the gas price for January delivery jumped by 6.6% to 45.15 p/therm.

 

Along the forward curve, the gas price for Q2 21 delivery rallied by 6.5% to 37.28 p/therm, amid a bullish energy complex.

 

European spot electricity prices fell sharply on Thursday due to an expected rise in wind generation, while mild temperatures prevented gains on the rest of the near curve.

 

As a result, the German day-ahead power price plummeted by 34% to 45.80 EUR/MWh, while the French equivalent contract settled at 52.21 EUR/MWh, posting a 25.7% slump day-on-day.

 

Meanwhile, bullish coal and carbon prices spurred prices further out the curve. Thus, the German Cal’21 power edged 1.7% higher at 44.64 EUR/MWh, while the similar contract in France added 1.3% to 47.86 EUR/MWh.

 

European carbon prices climbed to a three-month high on Thursday, supported by strong fundamentals in energy markets and expectations of an EU deal on CO2 emission cuts. As a result, EUAs expiring in 2021 jumped by 4.1% to 31.12 EUR/tonne.

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